Understanding Reverse Mortgage

reverse mortgageLet’s delve into the world of reverse mortgage and explore how it works.

The Home Equity Conversion Mortgage (HECM, pronounced heck´-um) is commonly known as a reverse mortgage. It’s a secure and increasingly popular financial tool intended for homeowners aged 62 and older. It has a wide variety of uses and benefits. Additionally, a this type of mortgage can effectively enhance cash flow and extend the longevity of assets throughout retirement years.

Exploring How Reverse Mortgage Work

Now, let’s build a foundational knowledge by starting with some of the basics!

Reverse mortgages in Myrtle Beach work by letting homeowners who are in the age 62 and older convert a portion of their home’s equity into cash. Also, they don’t have to sell the home or make regular monthly mortgage payments. Of course, as with any mortgage, keeping up with property taxes, insurance, and maintenance is required.

Moreover, unlike traditional mortgages, repayment of funds received through a HECM is deferred until after a maturity event, such as when you no longer live in the home.

reverse mortgageDispelling the Myths about Reverse Mortgage

Despite the rising popularity of this type of mortgage , there are still prevalent myths and misconceptions about the loan program.

Given the abundance of misinformation, it’s crucial you’re able to make an informed decision about whether a Myrtle Beach reverse mortgage makes sense for your unique goals and financial plan. To assist you in distinguishing between fact and fiction, we’ve compiled a list of the top myths and the facts behind this type of mortgage.

Myth vs. Fact

Let’s debunk some common myths associated with reverse mortgages.

MYTH: The bank or lender will own my house.
FACT: The reverse mortgage program was designed to help you stay in and own your home longer – you or your estate will keep your home’s title, just like a traditional mortgage.

Here’s another myth we can debunk.

MYTH: Getting this type of mortgage means that I’ll have to take on monthly payments.
FACT: One of the key advantages is that monthly payments are not required.

Now, let’s explore another misconception.

MYTH: My heirs will be responsible for repaying the loan.
FACT: It is a “non-recourse” loan – which means you or even your heirs will never owe the lender more than the home is worth at the time of its sale.

Moving on to the next myth.

MYTH: I can’t get this type of mortgage if my current mortgage isn’t paid off.
FACT: As long as you have enough equity in your home, and meet all other requirements, you can have a mortgage or other debt on your home’s title and still qualify.

Let’s address one more myth.

MYTH: Lenders really just want to sell your house.
FACT: You can stay in your home for as long as you want, as long as you meet the terms of the loan.

Now that we’ve dispelled some myths, let’s explore the benefits of this type of mortgage.

Reverse mortgageComparative Costs of Reverse Mortgage

Despite common misconceptions, this type of mortgage offers comparable costs to traditional mortgages.

In reality, charges and expenses are applicable to every type of mortgage – and this type of mortgage interest rates and origination costs are like to those of traditional mortgages.

Strategic Financial Planning

It’s essential to consider reverse mortgages as a strategic financial tool rather than a last resort.

When it comes to reverse mortgage loans, they are a powerful financial tool that can be an important part of your overall financial plan.

Taking Action

Armed with knowledge about reverse mortgages, it’s time to take action.

The first step to unlocking financial freedom in retirement begins with a proactive approach to financial literacy – by learning the truth about reverse mortgage loans, you’re already on your way. But it’s always important to discuss any major financial decisions with loved ones and trusted advisors, too.

Knowledge is Power

In conclusion, knowledge is indeed power when it comes to reverse mortgages.

When contemplating any financial tool, particularly one intended for retirement, it is crucial to grasp all the details. Armed with this new knowledge, you can more easily compare various home equity strategies with alternatives like refinancing or selling your home. And while the numerical details are crucial, it’s equally vital to keep the bigger picture in mind. Talk to an expert like David Stacy Reverse Mortgage Specialist for more details.

Consider where you envision your retirement years. If you plan to stay in your current home for as long as possible, your home may need some modifications or updates to help you age in place more comfortably and safely. Funds from a reverse mortgage can help with home renovation expenses.

On the other hand, if you plan on relocating to a new smaller home or one closer to loved ones, you can leverage a “reverse mortgage for purchase” to boost your buying power and land the home of your retirement dreams. These scenarios are just two of the virtually endless ways you can utilize funds from a reverse mortgage.

Ultimately, the power to change your future and secure the retirement you’ve been dreaming of is in your hands. Call David Stacy Reverse Mortgage Specialist now for more details. 

David Stacy Reverse Mortgage Specialist
Myrtle Beach, SC 29577
(843) 491-1436

We serve all of Horry County including: North Myrtle BeachCarolina Forest, Socastee, Forestbrook, Conway, Surfside BeachLittle River, Myrtle Beach, Forestbrook