Welcome to Mortgage Guide
Bank One Mortgage Article
. For a permanent link to this article, or to bookmark it for further reading, click here.
Reverse Mortgage Basics
from:Many consumers can benefit from an introduction to the reverse mortgage. This advance is a type of loan that allows a homeowner to borrow from their home’s value. The reverse mortgage has many interesting aspects to it for some homeowners to consider.
The borrower does not have to pay back any of the money that he uses in the course of the reverse mortgage. The package is designed for retired homeowners who need money but do not want to sell their current residence. Instead of selling, the customer simply borrows money against the value of the home.
The debt is to be repaid when the home is sold or in the event of the borrower’s death. Many elderly clients can benefit from this type of advance because they do not have to worry about repaying the debt. The money owed is simply taken out of the sale price when the home is sold.
But what if the borrower dies? The individual that inherits the home also inherits the debt. This is typically little trouble considering that the value of the home should greatly exceed the cost of paying off the debt. The loan company will work with the person that inherits the property to work out a viable agreement.
There is little risk of owing more than the home is worth. The lender accounts for the initial mortgage amount and the lender figures in the interest rate. The length of the loan and the home’s appreciation are also factored into the agreement. The amount of the money lent will not exceed the value of the home through the term of the loan.
Basic Requirements
A person will be typically unable to get a reverse mortgage if there is a lien on the property. In some cases, the borrower can use money that he receives in the loan to pay off any liens against the house. The lender will require that the lien be paid in full before making an agreement or the consumer will be required to pay the lien using monies from the loan.
The amount of the loan depends on a few factors. The home should be appraised and any necessary repairs must be made. The property’s location is another important component in the lending process. Well sought-after properties will yield more worth.
The interest rate will have an effect on the monthly installment and the overall cost of the loan. The borrower’s age is also a consideration. The reverse mortgage is designed for senior citizens. The older the borrower is, the more money he can receive through the loan.
The consumer has a few choices when it comes to the distribution of funds. He can opt for a lump sum, monthly installments or a line of credit through the reverse mortgage.
Bank One Mortgage News
One third of homeowners have no mortgage
More than a third of people have no mortgage debt attached to their home.
Read more...Central Bank wants more done over mortgage arrears
The Central Bank has said it is not comfortable with the high level of mortgage arrears, and wants mortgage lenders to do more to tackle the issue.
Read more...FDIC sues big banks over subprime mortgage losses
United States deposit insurer FDIC has sued Deutsche Bank and other big financial groups, seeking damages for mortgage losses. The lawsuit is one more attempt to clean up the subprime mortgage scandal.
Read more...Community Housing Innovations (CHI) Will Host Free Fast Track™ Loan Modification Workshop; Chase Mortgage Holders ...
Community Housing Innovations (CHI), a HUD approved non-profit housing counseling agency, will host a free three day event to help Chase Bank mortgage holders who are having difficulty paying their loan move closer to a resolution through one-on-one meetings with Chase Bank representatives. The event will take place on June 12, 13, and 14 at the CHI offices located at 190 East Post Road in White ...
Read more...Bank of the West Sees Rise in Mortgage Applications from HARP 2.0
SAN FRANCISCO, May 14, 2012 /PRNewswire/ -- Bank of the West has seen a rise in mortgage loan applications since April as homeowners seek to take advantage of low interest rates under the government's ...
Read more...