A reverse mortgage is a type of mortgage in which you can release equity from your home in order to help fund your retirement. This can be an excellent tool for helping overcome the gap between the end of your super or pension and your actual bills. Read on for more information about reverse mortgage solutions.
What Are Reverse Mortgages?
Remember all the years that you spent paying off your mortgage? What if you could get that money back? That is, essentially, what a reverse mortgage is. These types of mortgage are only available to those over 60, and they’re meant to be used in order to support your retirement lifestyle. The Australian government is making it so that people are more responsible for funding their own retirements – and this making it difficult for some people as their super and pension aren’t providing the money they need to support their chosen lifestyle. It may not be the extras doing them in, either. It could be something vitally important such as medicines, hospital stays or a new car.
Many people will go the obvious route, selling their biggest asset for more money. Unfortunately, this can often compound the problem as they now need a place to live. The answer to getting the money that you need to fund your retirement while still living in your home is to take advantage of reverse mortgages. As stated above, it’s kind of like getting mortgage payments yourself.
A reverse mortgage is a type of mortgage available to property owners, older than 60 and they’re great for pensioners. These mortgages allow you to release money from your home using equity. These funds can be used as a stream of income or can be borrowed against. Like all money – it can be used for anything you like. You can use it to fund travels, medical needs, home improvements, anything you want.
This is still a loan product, which means there is still interest that you will be charged. However, you aren’t required to make payments on this type of loan. Your interest on this loan will be capitalised, or added to the amount of the loan. Instead, you will repay this loan either when the home is eventually sold. Hopefully, the sale of the house will more than pay off the loan and leave some profit in your hands or the hands of your beneficiaries.
You have a variety of reverse mortgage options if you’re over sixty and you own your home. It’s important that you choose the loan which is right for you, and that will depend on your own personal needs and a variety of other factors.
In order to find the correct solution for you, it’s recommended that you work with a professional mortgage broker in order to help you find the reverse mortgage solution which is best for your needs. These brokers will be able to look at your situations objectively, and they’ll know exactly what solution (or solutions) will be the best fit for your circumstances. They can then take their skill and expertise, along with their access to multiple lenders and hundreds of loans and put it to work for you. They’ll do all the legwork, finding the loan which will give you the highest amount of money with the lowest interest rates.
Do keep in mind that a reverse mortgage is still a loan, and it will have to be repaid at some point in the future. While it might not be you who will be doing the repayment, you still want to make sure that you don’t burden your survivors too much. If at all possible, it would be nice if they walked away from the sale of your home with some little bit of profit, or maybe even found a way to keep the home they may have grown up in. Keep this in mind when you’re looking into reverse mortgages, and your mortgage broker will be able to find you the best possible loan solution to help you and your family get through your retirement gracefully.