Reverse mortgages are seen as a way for seniors to tap into their current homes as a source of income. By drawing from the equity they already have, they can pay off bills, make improvements to their current residence in Eureka Montana 59917, or even take a well-earned vacation. There is one option that most do not even consider: using a reverse mortgage for the purchase of a newer property.
Understanding a Home Equity Conversion Mortgage
In order to see how using a reverse mortgage for purchase of a newer property works, you first must understand the Home Equity Conversion Mortgage (HECM). The HECM is still relatively new, but it provides a way for those who are 62 years or older to borrow against the value of the home. With approval, the borrower gains access to funds without having to make monthly payments. Repayment of the loan does not occur until the borrower either passes away or sells the property.
This loan is not an option for everyone. In fact, the guidelines stipulate a minimum age of 62 years old. The borrower must also either own their home outright or have a large amount of equity built up in Eureka Montana 59917.
Using Reverse Mortgage for Purchase
For some older Americans, the idea of living closer to family members is ideal, but they do not necessarily want to give up their existing home. If this is the case, they may apply for a reverse mortgage. The borrower must occupy this second home for a set portion of the calendar, and the original residence, which the loan is against, must be the borrower’s primary residence in Eureka Montana 59917
When using a reverse mortgage for purchase, there are some limitations. For example, this type of loan only covers 47 to 52 percent of the purchase price. It is the borrower’s responsibility to make up the difference. This money can come from a retirement account, savings, or a gift. The actual amount borrowed depends on the age of the youngest borrower, current interest rate, mortgage insurance premium, and the home’s value at appraisal.
Additionally, only certain types of residences qualify for a reverse mortgage. These include single-family homes and two to four unit homes where the borrower occupies one of the units. For condominiums, the U.S. Department of Housing and Urban Development requires preapproval. In addition, manufactured homes must also have FHA preapproval. The borrower must also obtain a certificate of occupancy for any new construction.
A reverse mortgage is a great way for seniors to get a second home closer to family. As with a traditional HECM, there are no monthly payments due. A single, balloon payment, is due at the sale of the home, when the last borrower moves out or passes away. This payment is a total of the principle plus interest. If the home sells for more than this amount, the borrower, heirs, or the estate retains the remaining equity. Should the home appraise and sell for less than the amount owed, there is a guarantee of no personal liability. Lenders are insured against this type of loss in Eureka Montana 59917.
Surrounding Areas In Montana
Video: Mortgages in Eureka MT
View 39 photos of this $399,000, 3 bed, 2.0 bath, 1532 sqft single family home located at 881 River Dr, Eureka, MT 59917 built in 2011. MLS # 21607938.
Zillow has 236 homes for sale in Eureka MT. View listing photos, review sales history, and use our detailed real estate filters to find the perfect place.
According to our research of California and other state lists there was 1 registered sex offender living in Eureka, California as of July 13, 2017. The ratio of ...
Apply for Section 8 Housing . Important: Please Read All Directions Carefully. Notice to Applicants not currently living in Montana: Applicants must relocate to ...
About Reverse Mortgages. For many seniors the equity in their home is their largest single asset, yet it is unavailable to use unless they use a home-equity loan.
The destruction of the Eureka Hotel in Ballarat in 1854 and theft of the Eureka Hotel from the owner Catherine Bentley in 1859 illegal land sales, The Bentley family ...
Under the Title I program, FHA approved lenders make loans from their own funds to eligible borrowers to finance the purchase or refinance of a manufactured home and ...
Personal Banking, Business Banking, SBA & Commercial Lending. Serving Buckhead, Sandy Springs and Decatur communities.
Use this free mortgage calculator to estimate your monthly mortgage payments. See how interest rates, terms, and extra payments affect your monthly payment.
Welcome to the Redwater Valley Bank and Garfield County Bank Financial Education Center! Credit Scores, mortgages, and identity theft may not be top of mind for you ...