Real Estate Foreclosures » Seniors and the Reverse Mortgage

Seniors and the Reverse Mortgage

Posted on August 19, 2008
Filed Under Foreclosures | Leave a Comment

Foreclosures seem to be getting worse every day. You only need to look on the Internet or read a newspaper and you will find the latest foreclosure news. The foreclosure of a home is devastating but there are some local and government work being done about the mortgage mess.

If you own a home, you most likely know that the Housing Stimulus Plan has passed through Congress and the president has signed it. The housing plan offers refinancing for adjustable mortgages, economic incentives to bail out troubled lender, and tax breaks for those buying a home for the first time.

These provisions are designed to stop or at least slow down foreclosure filings and protect the economy. However, the guidelines for refinancing into a fixed loan will not let you refinance the loan if it is found that you cannot afford the payments. You will also have to verify your financial information including assets, income and credit. Because of this, thousands of homeowners will have very few options, especially senior citizens with a fixed income.

There are a number of senior citizens with a lot of equity built up in their homes but with the high cost of food, fuel, and medical expenses, they are fighting to pay the bills they have. Social Security simply does not pay enough to live on and pensions are no longer secure. For many seniors it is a choice between making their mortgage payments and buying the medicine they need to survive.

There are many seniors, especially widows who have lost a spouse and their retirement and pension income, in a very bleak situation. After being diligent with paying their bills for a number of years, they are now in a very bad situation which is said since they are supposed to be enjoying their “Golden Years”.

For many senior citizens there is the option of a Home Equity Conversion Mortgage or “reverse mortgage”. This program is insured by the FHA and endorsed by the AARP. This program allows a senior citizen to borrow against their house and the loan does not have to be repaid until the senior citizen dies or moves out of the house.

A reverse mortgage is perfect for a senior citizen who is facing foreclosure or bankruptcy. This program lets you usually borrow sixty percent of the value of the home, if not more. The proceeds from this loan can be used to pay off your mortgage and free up the old mortgage payments for use in other capacities. In a lot of cases, a reverse mortgage can provide extra income or a line of credit for use when something unexpected happens.

If you are having difficulty paying your bills, are considering filing for bankruptcy or facing foreclosure it is important to look into your options. A reverse mortgage is a great option for those in financial trouble. There is a lot of information about reverse mortgages available.

A reverse mortgage may be just the thing to save your house from foreclosure and let you live in the house comfortably for many years.

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