Most senior citizens realise quickly that they won’t have enough money to live comfortably throughout their declining years. It can be upsetting to understand that you worked for your whole life, and now that it’s time to relax and enjoy yourself, you’ll have trouble making ends meet. If you find that you can’t pay bills, need more money for groceries or can’t afford medications, you may be asking what is best for your retirement income, especially if you’re already retired and can’t work anymore. You may have some investments, such as certificates of deposit and bonds, but they probably aren’t helping as much as you want. Therefore, you may want to consider alternatives, such as a reverse mortgage.
What It Is
A reverse mortgage is offered by traditional lenders and can convert some of the equity in your home into extra cash or income for you. It is usually offered to senior citizens 62 years of age and older. You can often use the money for whatever purpose, though most use them for extra health care, to pay off debts and for everyday living expenses.
Types
You may find that there are many options available when it comes to reverse mortgages. Sometimes, they are issued by private banks, though insured by the government. Proprietary ones are rare, but can be seen. They are only offered by private lenders and banks and aren’t backed by the government. Single-purpose ones are also available to those with low or moderate income and may have stipulations as to how the money can be used.
What/How Much You Get
You can get up to any amount, but there are some factors involved. For example, your current mortgage’s interest rate will make a difference, as well as your monthly premium. You will also need to have the home appraised, and your age will also be a deciding factor.
Fees
There may be more closing costs and fees associated with a reverse mortgage, so most countries require your solicitor to look over everything and explain it to you thoroughly. However, they can be an excellent alternative to other loans, especially if you need to supplement your retirement income.
How It Helps
Other loans will be based on credit history and other options and will need to be repaid sooner. You won’t have to repay the loan until you pass on, or you move somewhere else, which means you can have the money you need to stay in your home.
If you’re asking what is the best for your retirement income, you aren’t alone. Many senior citizens need more help, which is where RMFS (Reverse Mortgage Finance Solutions) can help. Visit them today to learn more.
