Minnesota Reverse Mortgage

Many retirees choose to live in Minnesota for its accessible health care, strong focus on continued education, and natural beauty.  Though homes are affordable and living costs are low, a Minnesota reverse mortgage can help seniors homeowners in the state secure the income they need to retire well.

Reverse Mortgage Minnesota Information

To qualify for one of the many reverse mortgages in Minnesota available to seniors, you need to meet just a few basic requirements.  You must be at least 62 years old, you must own a home, and you must have at least some equity in the home that you own.  That’s it.  Your reverse mortgage package will look different than others depending on your age and your financial needs and plans, but in general, the structure is the same for all.  Your lender takes over ownership of your home equity and transforms this equity into money you can spend by making payments to you at intervals or as a lump sum.

When you receive money from your lender, you don’t have to apply it to your home.  The money is no longer tied to your property in the form of equity.  You can spend it on anything.  Medical costs and basic day to day living expenses will likely claim some of your money, but feel free to put the funds toward a vacation, a new car, a down payment on a home, or anything else you feel you need.  There is plenty of reverse mortgage information available on this site to help you understand the financial benefits that this loan can provide.

Your lender will provide the money to you in whatever way you specify.  In general, there are three primary payout methods available to choose from.

• The lump sum payout.  This method provides you with all of your money up front, to spend as you wish.
• The monthly payment plan.  This method splits your money up into small chunks and pays you each month over several years or decades, until your equity is depleted.
• The credit line option.  This method makes all of your money available to you as you need it through a credit line.

You can also combine any of the above methods or vary them to meet your needs.

You lender owns the equity of your home during and after the reverse mortgage process, but your lender won’t ever own your home.  You can rest assured that you can continue living in your home as long as you want, even with a reverse mortgage.  The title or deed remains in your name only.

When you pass away, your heirs will have to pay back the reverse mortgage debt.  But this is not a problem.  The debt follows the home.  With most reverse mortgages, the heir or heirs will sell the home and use the money gained from the sale to pay off the debt.  The government has established laws that prevent lenders from trying to collect more money than what the home sold for, even if the reverse mortgage amount is higher than the value of the home at the time of the sale.

The HUD has written answers to many Frequently Asked Questions related to reverse mortgages.  Read through this document to learn more about this unique loan type.

Minnesota Reverse Mortgage Lenders

Finding the right reverse mortgage lender is the most important responsibility you have when taking out a reverse mortgage loan.  Everything else is secondary.  If you don’t find the best lender, you may end up losing a portion of your equity through fees and high rates on the loan itself.  Your equity is a finite amount that cannot be easily replenished.  Avoid as many fees as you can.

To find the best lender, simply contact four or five lenders in your part of Minnesota and compare the rates and fees they charge.  Don’t let any of them know that you’re shopping around, though.  Ask them for their real rates, not their advertisement rates.  Fees can add up fast.  Find out what fees they charge and how much they charge for each fee.  You can learn more about these aspects of the loan by reading our reverse mortgage checklist.

About Minnesota

Known as the land with 10,000 lakes, Minnesota is home to 5 million residents. It ranks among the healthiest states by a number of measures and has one of the most highly educated populations of any state in the nation.

Roughly 60% of all Minnesotans live in the Minneapolis-St. Paul metropolitan area.  St. Paul boasts the nation's largest mall, known as the Mall of America, with 520 stores and an indoor amusement park. Twin Cities, as St. Paul and Minneapolis together are known, is home to both a thriving business community and a major arts center.

These aspects, combined with the natural beauty of the area and the ease of access to healthcare that Minnesota is known for, make this state a great one for retirees and a perfect place to take out a reverse mortgage.

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