Yes, 50% is a good starting out point. However the older you are the more you qualify for with a reverse mortgage. In this market some lenders are taking reduced payoffs. We specialize in working with clients who may owe to much to payoff of there current loan with a reverse mortgage by dealing directly with the bank and showing them why it would make sense to take a reduced payoff. Contact us for more information. www.freeHECMguides.comNov 30th 2009
To be eligible for a reverse mortgage, there must be substantial equity in the property. Minimally, the amount of equity should be in the neighborhood of 50 to 60% of the appraised value, depending on the ages of the homeowners and the current interest rate. The reason the equity requirement is so high is because the equity must last the expected life time of the youngest owner on title to the property.For example if the youngest homeowner has just turned 62 (which is the minimum age requirement to be eligible for reverse mortgages) the money being paid out to the seniors from the built up equity, could potentially have to last 30+ years.Aug 29th 2009
You need good equity in the home but the details depend on your age. There is a formula that calculates whether or not you can do a "make no mortgage payments" only type of reverse mortgage or a "also take money out monthly and if so how much" type of reverse mortgage. Basically the older you are the less equity you need because statistically you are likely to have the mortgage for a short period of time. A loan officer can input the person's age, home value and any mortgage balance into an electronic form that calculates an answer to a specific situation for you.Aug 29th 2009
Furthermore, reverse mortgage qualifications are much simpler than traditional loans, which require many forms of verification and approval. In contrast, reverse mortgages require only that borrowers be age 62 or above, own at least 30% of the equity on their property, and that the property be the borrower's inhabited primary residence. Finally, since reverse mortgages are "non-recourse" loans, borrowers do not worry about leaving heirs with debt, as they will not be responsible for paying any decrease in equity during the course of the loan. Many seniors are going to find http://www.reversemortgagelendersdirect.com/reverse-mortgage-information/ to know more. Its help me lot.Apr 17th 2013
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