What is a reverse mortgage?
A reverse mortgage is a type of home equity loan that allows you to convert some of the equity in your home into cash while you continue to own the home. Reverse mortgages operate like traditional mortgages, only in reverse. Rather than paying your lender each month, the lender pays you. Reverse mortgages differ from home equity loans in that most reverse mortgages do not require any repayment of principal, interest, or servicing fees as long as you live in the home. The reverse mortgage’s benefit is that it allows homeowners who are age 62 and over to keep living in their homes and to use their equity for whatever purpose they choose. A reverse mortgage might be used to cover the cost of home health care, or to pay off an existing mortgage to stop a foreclosure, or to support children or grandchildren. Note: Reverse mortgages are now available in every state except Alaska, South Dakota and Texas. But willing lenders may still be scarce in some places. When the homeowner dies or moves
The opposite of a traditional mortgage, a reverse mortgage pays you money, turning your home’s equity into cash, a line of credit, monthly income or a combination thereof. Funds are tax-free (consult your financial advisor) and provide a unique source of financial security to give you the freedom and peace of mind to fully enjoy your retirement years. NWFCU has partnered with Credit Union Mortgage Association (CUMA) to offer this loan option to our members. Our Mortgage representatives can put you in touch with a CUMA Advisor who will answer all of your questions and provide counsel to help you decide if this loan is right for you.
