subject: An Introduction To Reverse Mortgages [print this page] The terms and conditions of a reverse mortgage do not require the homeowner to pay for the loan during their lifetime or until, the home is sold or the owner leaves. On a reverse mortgage, payments are made out to the home owner and the debt adds up while the equity on the house decreases .
The receiver of the mortgage does not require a income or credit card but the client will have to be counseled by an approved third party financial counseling organization prior to applying for a the mortgage. The borrower will be charged for each counseling session so persons can ask all the questions hey need to, to be properly informed. It is essential that the borrower is completely aware of what a reverse mortgage is, so they can protect themselves. As this type of mortgages are fairly new, you should be properly informed. Persons who are interested in getting a reverse mortgage holders can surf the Internet and visit the HUD information site in order to get a list of approved reverse mortgage lenders. All lenders of reverse mortgages must be authorized through HUD, if you decide to obtain this type of mortgage from an entity that is not authorized then your property might end up owing more than your home is actually valued at.
During the time when a person receives a one of these mortgages they cannot be asked to leave the house because they are still the deed owner and heirs may still be able to get the property if the owner passes away as long as they can refinance the mortgage but this must be completed within a year of the owner dying.
The fact that the mortgager still owns the house, means that the borrower is still required to pay for the maintenance of the property. This include tax liability, home insurance and general utility fees. Failure to make payments on home insurance, taxes and basic utilities this can lead to the depreciation of the property.The borrower must maintain all the terms and conditions of the loan. Reverse mortgages usually come with many hidden charges expenses such as origination fees, closing cost, growing interest percentage and various other mortgage fees. These fees are charged at the discretion of the mortgage lending company.
