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Just like having any traditional mortgage, you can sell your home with a reverse mortgage.
Terms like home values, market values, and appraised values can be confusing. This process requires you to stay informed as a borrower with the help of a real estate agent and real estate attorney.
Because a HECM is a non-recourse loan, you will never owe more than the worth of the home. If you’re concerned about the housing market value, don’t fret.
According to the Consumer Financial Protection Bureau, if you owe more than your home is worth, and sell for the appraised market value, the remaining balance will be paid by mortgage insurance.
Call your mortgage servicer to get your loan balance and a payoff quote to begin the process of selling your home.
Yes, a reverse mortgage if you pass away must be repaid to avoid foreclosure. The lender will continue to charge interest and fees until your heir(s) pay off the reverse mortgage.
If the home sells for at least 95% of the current appraised value of the property, your heirs are free and clear from the reverse mortgage debt.
If you decide to move out of state with family members or move into an assisted living facility, putting a plan together to sell your home is important. Be sure to do the following:
If you plan to sell your home, make sure you speak with your loan servicer since HUD overseas HECM loans, and private loan servicers may have different requirements.
Traditional mortgages allow you to pay down your mortgage balance over time. A reverse mortgage pays you monthly or in a lump sum. A reverse mortgage increases debt.
It is possible that you may deplete your equity. The balance and interest on a reverse mortgage must be repaid. Your heirs will receive any money that remains after the home is sold.
Alternatives To Selling A Home With A Reverse Mortgage
It may be beneficial to get financial assistance from a program for seniors that assists in paying your property taxes, home insurance, or other expenses.
Reverse mortgages may not be the best option for you for various reasons. A deed in lieu of foreclosure can relieve you of the stress of mortgage payments.
A Deed in lieu is simply a way to return the home to the lender without any further obligation.
Local Experts
Now you know that acquiring a reverse mortgage and then selling your home later in life is not a penalty. You can always sell your home.
If you’re looking for a way to secure or enhance your financial future and take advantage of the recent rise in home values while they are still up, selling your home and paying off the reverse mortgage may be right for you.
"We may not want to be the first to the party, but we sure don't want to be the last either"
Feel free to reach out to us. We can answer any questions you have and walk you through every step of the process. There is no pressure; just good, honest and helpful information.
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Consider Ascentia Maui to be your resource for all Real Estate Needs with a heavy emphasis on Probate, Trusts, Conservatorships and Guardianship Sales. You can also count on Ascentia Maui as your 'Boots on the Ground' for Cleaning, Lawn service Surveys, Inspections, Contractors or anything you may need.
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