Top 10 Questions About Reverse Mortgages in Tampa
It can be challenging: making a important determination concerning your biggest investment, a choice connected with a place that means the most to you. Determining if a reverse mortgage in Tampa Florida meets your needs requires significant thought and focus. We hope all of the following answers and questions aid you in this process.
Just what is a reverse mortgage and should I apply?
A reverse mortgage is a special loan that enable homeowner(s) 62 years of age and older in Tampa Florida to draw on the equity in their property, that is paid to the homeowner(s) in cash. The unique element of this loan is that it doesn’t require to be paid back until the homeowner(s) does not reside in the house. Developed by The U.S. Department of Housing and Urban Development (HUD), this federally insured home loan goes to help those in the senior population fulfill their personal financial requirements and ease money problems for greater peace of mind.
Prior to applying for the loan, it is necessary that that you are informed about the conditions of the reverse mortgage through sources provided by HUD. Call the Housing Counseling Clearinghouse at 1-800-569-4287 to get the name and number of a HUD-approved counseling organization plus a list of FHA authorized lenders in your community.
Will my Florida home be qualified for a reverse mortgage?
Property qualified for a reverse mortgage can include single family houses, detached houses, town homes, and two to four unit properties that are owner occupied. Condo properties must be FHA-approved; certain individual condo units meet the requirements under the Spot Loan program.
Why shouldn’t I select a bank home equity loan rather than a reverse mortgage loan?
Reverse mortgages in Florida are popular because they give you funds that doesn’t need to be repaid as long as you remain in your house. On the other hand, getting a home equity loan (or a second mortgage) usually requires you have a sufficient amount of cash flow to pay for the debt, additionally you have to continue to make monthly home loan payments. With a reverse mortgage loan, you don’t need to make monthly home loan payments and the government insured loan could safeguard you from foreclosure provided you pay your real estate costs which includes property taxes, insurance, Home owners association dues etc.
How much money should I anticipate getting?
The proceeds you are able to potentially gain access to depends on your age, today’s interest rates, plus the appraised home value or FHA’s mortgage limits for your area, whichever is less. As an example, an older borrower which has a much higher value home will be qualified for more than a the younger person with a lower value property with the same exact rate.
What if I outlive the home loan? Will I have to repay the Tampa mortgage company?
No. If you or one of the borrowers lives in the property and will continue to pay the taxes and homeowners insurance, you won’t be required to payback the reverse mortgage.
Must my house be mortgage free to be eligible for a a reverse mortgage?
No. It’s not necessary to pay off the home to apply. Plus, you will continue to carry the title to your home.
Do I need to pay income taxes on the funds payments I obtain?
The money you will get from a reverse mortgage are income tax free. But, since you retain the title to your property, you’re still required to pay for property taxes, homeowners insurance, utilities, power, upkeep, along with other property related costs. Interest on reverse mortgages is not tax deductible on tax returns until the reverse mortgage is paid partially or entirely.
How can this home loan affect my estate and exactly how much could be left to my heirs?
After the final living borrower dies, sells your house, or no longer lives there as the primary residence, you or your estate is accountable for paying back of the money you received from the reverse mortgage, in addition to interest and other service fees. Any leftover home equity belongs to either you or your heirs. A “non-recourse” condition could protect against both you or your estate from owing more than the value of the home once the mortgage loan is paid back.
Should I use an estate planning company to obtain a reverse mortgage?
HUD recommends against using an estate planning provider, specifically any service that wants a lender referral fee, to procure a reverse mortgage. HUD provides you with this info free of charge and can direct you to HUD-approved housing counseling organizations that provide referrals to a list of HUD-approved loan providers and other solutions without cost or at a low cost. Locate a HUD-approved housing counseling service close to you by calling 1-800-569-4287 toll free.
How can I acquire my payments?
Reverse mortgage payments are usually received in one of five options:
Tenure: equal monthly installments
Term: equal monthly installments for a fixed amount of months as chosen by the borrower
Line of Credit: payments done in installments or at various times and amounts dictated by the borrower(s)
Modified Tenure: monthly installments along with a line of credit
Modified Term: monthly installments during a fixed amount months which includes a line of credit