One of the biggest myths that is out there about the reverse mortgage program is that your kids or heirs can owe more than the house is worth when you die.
The Reverse Mortgage loan in Memphis is a federally insured loan. This insurance makes it so that neither you nor your heirs ever end up owing more than what the house is worth and this feature is what makes this loan a safe and secure way to tap into your homes equity. The mortgage insurance premium is part of the closing costs of your loan and it protects both you and your estate.
What do your heirs need to know?
Even though the mortgage insurance provides security for you and your heirs to know that they will not ever end up owing more than what the house is worth, they do need to know that the Home Equity Conversion Loan will become due at the death of the last borrower. What your heirs do with the house is up to them and typically the decision involves how much equity is left in the property. Whether your heirs decide to keep the property, sell the property, or turn the keys over to the lender, they will not owe more than the house is worth.
What happens once the last borrower on the loan dies?
Initially the heirs will receive six months to have the loan paid off. Interest on the balance and monthly insurance premiums will continue to eat into any remaining equity until the loan is paid off. It is to the heirs benefit to have the loan paid off promptly.
“Reverse Mortgages” are “nonrecourse” loans”, stated Chris Brundige, with FirstBank, a Reverse Mortgage Lender in Memphis. A Nonrecourse loan means that; if the loan amount exceeds the home’s value, the lender cannot go after the rest of the estate or the heirs’ other assets for payment.
“There are many myths out there about the (HECM), which is the abbreviation for the term Home Equity Conversion Mortgage, or the more common term, “Reverse Mortgage loan”, stated Chris Brundige, of FirstBank Reverse Mortgage. Chris went on to say, he wrote an eBook detailing many of these myths, that have been innocently passed on by well meaning, yet misinformed friends, family, and neighbors. In Chris Brundige of FirstBank’s free eBook, you will learn the facts behind the myths. You can download your free copy here to learn just-the-facts of the Reverse Mortgage.
FirstBank requires both borrowers to attend Reverse Mortgage counseling prior to acquiring a HECM. If you are interested in the program and would like to learn more about how FirstBank’s Reverse Mortgage loan or Reverse Mortgage Line of Credit in Memphis could help extend the life of your retirement plan or take advantage of your largest asset, Chris Brundige with FirstBank, a licensed Reverse Mortgage lender in Memphis would be glad to help you. Please call Chris Brundige at 901-472-1301 to get started or visit http://reversemortgagelenderintn.com to use our free calculator. You can also join in on the conversation by following us on Facebook and liking our page.
*Homeowner is still responsible for paying property taxes, insurance, and property maintenance.