Reverse mortgage sales are rising rapidly, mainly because the baby boomers in the US are now finally retiring. These elderly people, who own their house, can tap into the equity that they’ve invested in their property. This is done by purchasing a reverse mortgage. If you are dealing with reverse mortgage experts who have a significant market share and are well reputed in the market, then they will definitely disclose following three things before closing a reverse mortgage sale.
Reverse mortgage is a financial product that has to be purchased. Although, you will get a fixed amount of money for an indefinite period of time, in the beginning you will be required to pay some fees, like the origination fee, closing fee appraisal fee, servicing fee, etc. All these fees would be disclosed by reverse mortgage experts before a deal is closed in order to avoid any discrepancy in the future.
Every financial product has some risks associated with it. These risks are basically possible actions that can be taken by the lender if the borrower breaches the terms of the contract. These risks too are disclosed by reverse mortgage experts.
Type/Mode of Payments
A reverse mortgage allows the borrower to withdraw the payment in three different ways. The borrower can either choose to receive fixed amount of monthly payments, withdraw 60% of the total value of the loan in one lump sum, or ask the lender to extend a fixed line of credit. The amount that the borrower will receive under each option also has to be disclosed prior to the signing of a reverse mortgage agreement.
Longbridge Financial is one of the reverse mortgage experts that are approved by Federal Housing Administration (FHA). It operates in 46 states and is committed to providing financial peace of mind to the elder generation.