The usual way that mortgages work is you borrow money from the lender, build on your equity, and you are supposed to pay some small amount of money till you complete the payment. But it comes to reverse mortgage; the lender pays money in cash for the equity that is the home or the property which quite the opposite of the regular mortgage. This is a unique type of mortgage because it allows you to convert some of the equity into cash. Your home will act as collateral though it is you who is being paid the amount of money as agreed. Below are some of the advantages of using the reverse mortgage.
The home equity conversion mortgage is limited to the age of 62 old couples or persons. At these ages, therefore, you can use this mortgage to get some extra cash to top up the retirement package that you already have. The home equity conversion mortgage allows you to have inflows from the lender meaning the only money you will have to pay is the taxes required and also the home insurance. Another advantage of the reverse mortgage is that you will remain with the title of your property till you decide otherwise and especially upon your death then the title changes hands to the lender who can sell the or own the property. Unless you fail to adhere to the rules and regulations set, then you cannot lose the title as most people believed that you lose the titles of the property immediately you sign the agreement with the lender.
With home equity conversion mortgage, the amount is paid in various payment or installment. These payments can be paid according to the level of need or the use the money is needed, for example, to pay hospital bills which is an emergency. The reverse mortgage can be paid in lump sum or monthly, yearly and any other mode of payment that you agree to use with the lender.
The other factor that makes the home equity conversion mortgage amazing is the fact that the federal government. The government came to aid of this mortgage because people were saying it is a method of stealing from the elderly. To curve such behaviors of stealing, the state legalized the whole process in that for there to be any agreement; legal documents had to be signed in the presence of lawyers. Additionally, when the market declines against what you had agreed earlier, the government will cover up the amount is less through the insurance policy, therefore fear not. And also this is a significant indicator that your home will be sold at the price on which you had agreed.