A Reverse Loan Can Save The Home Foreclosure

The reverse loan is a product, which has increased the popularity a lot

, because of the many benefits to the senior citizens. In Florida some 4 % of the usual mortgages are facing the foreclosure and in Connecticut about 2.500 took the reverse loan and saved their economies.

1. Save The Credit Score.

The foreclosure refinancing is worth doing. If a borrower will do nothing, the damages are really big ones. His credit score will drop by 250 or 300 points, but the worst thing is that he will lose his home. Think about that!

The reverse loan offers the following benefit. The borrower can first pay away the traditional mortgage with the reverse loan. This alone will drop the monthly payments a lot. And you have to remember that the borrower will not pay anything back on a monthly basis.

2. Act Immediately.

One thing is very important. When your mortgage payments are late, take contact to the lender as soon as possible and tell him, what you are going to do. The lenders have no intention to drive you into the bankruptcy. That is not their benefit.

3. The Question Is About The Monthly Payments.

This sounds too simply, but that is the whole idea of the reverse mortgages. I.e. to save the monthly payments of the seniors and to get more disposable cash money by releasing a part of the home equity.

4. With The Reverse Loan You Do Not Have Monthly Back Payments.

Yes, everything will be paid back, when the reverse loan will be closed. This happens, when the last borrower will move away from the property, sell the property or die. If the selling price does not cover the whole sum, then the missing part will be paid from the compulsory mortgage insurance. This means, that the borrower will never pay the reverse loan from the other assets.

5. Who Can Get The Reverse Loan?

This product is meant to the senior people, who own their homes, where they have equities left. Additionally they must be at least 62. The incomes nor the credit scores have no meaning, because the home is the guarantee.

So if you are in the danger of the home foreclosure, the reverse loan can be a very big help. It will simply release the equity of the home and turn it into cash money, which you can use to whatever purpose you want. When you will pay away the usual mortgage, your problems are over.

by: Juhani Tontti

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