Monday, September 8, 2008

Long-Term Care Insurance - Can a Reverse Mortgage Be Right For You?

I 've written previously about long term care insurance policy and now long-term care insurance can a reverse mortgage be right for you. Ok, resume to reading....

Reverse mortgages be right for you are battered in the media recently, but reverse mortgages are often the perfect solution for cash-strapped seniors. The dollars that come in from reverse mortgages can make the difference between paying basic bills such as food and utilities, and even certain medical expenses or not. Reverse mortgages are designed for people 62 years and older. They enable you to become a bank buy back your home while you still live. You have to pay the money back (plus interest) when you vacate or sell the house, and costs involved. Yet these mortgages have a place, and they can be found quickly.

Here is what you need to consider before you (or your parents) commit to a reverse mortgage:

Your age. These mortgages are not for everyone, but the older you are, the more likely to benefit from. You For one, you probably have more equity in your home. But the other reason is this: Banks calculate the payout based on not only the value of your home, but your age and the average expected length of life.

Your situation. A reverse mortgage be right is probably not for you if you do not plan to stay in your home for a long time, so consider beforehand. Then think about other factors related to both your current and future lifestyle. People get these loans for a variety of reasons. Some do it to finance an active lifestyle in their retirement, others because the house needs to be repaired or updated with healthcare equipment or to help with the rising costs of health care.

Learn how the loans work. Most reverse mortgages do not require repayment as long as you live in your home. The loan must be repaid in full, together with interest, when the last surviving borrower dies, sells the house or moves away.

Understand the role of the lender. Will provide you with a loan in an amount ranging from 20 percent to 60 percent of your home equity - a lender - usually a bank. Will in return receive a share of the value of your home when you die the house. Or sell the lender

long term care insuranceChoose a payment preference. The loan can be paid to you in three ways: as a lump sum, in regular monthly or quarterly installments, or you can tap a line of credit as needed.

Know your responsibilities. Borrowers are responsible for property taxes, insurance and home repairs. Your loan may become due and payable in full if you do not meet these responsibilities.

Assess neighborhood real estate prices. Over time, a reverse mortgage whittles away at the home equity you have built up over the years. But stay if you live in an area where house prices have a history of rising, could your home equity to rise despite your reverse mortgage. It goes without saying, though, that you can never count on such increases for eternity. As proof, just check out the housing slump and related foreclosure fallout sweeping real estate markets throughout the United States.

The reverse mortgage can be right for you an excellent financial planning tool for seniors from all walks of life. It can improve their retirement by some extra income to help seniors with a lifestyle of their choice. They can be used as a part of their succession or legacy planning

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