Reverse Mortgages Flashcards
In a reverse mortgage how many payments does the borrow owe
the borrower doesn’t have to make any payments in a reverse mortgage
who makes the payments in a reverse mortgage
the lender in many cases will make the periodic payments to the borrower
where do the payments the lender makes to the borrower come from
they come from the borrowers equity in the home
who are reverse mortgages for
-for homeowners aged 62 and above
- who lives in his or her home
what do reverse mortgages allow older homeowners to do
it allows homeowners aged 62 and above to:
- use equity in their homes to meet expenses of living
- to pay for home improvements
how do most individuals that get a reverse mortgage receive their money
they receive it in what is called a tenure method
what does the tenure method mean
the borrower will receive the payments over time such as monthly checks
in reverse mortgages what happens to the balance and equity
the balance of the loan rises and the equity shrinks (rising debt, falling equity)
why does the balance rise and the equity shrink
because we are taking money from them each month to cover the monthly payment
in a reverse mortgage the mortgage is payable in full when
the home is sold or the last surviving homeowner dies
what are reverse mortgages also referred to as
Home Equity Conversion Mortgages. (HECM)
in a reverse mortgage what is the amount an applicant can borrow based on
its based on the age of the youngest borrower
in a reverse mortgage what do individuals have to demonstrate
their ability to make property tax and homeowners insurance payments
in a reverse mortgage what payments have to be paid on their own
the property tax and homeowners insurance
in a reverse mortgage what payments are covered
the principle and the interest
