Federally Insured Reverse Mortgage
What is a federally insured reversed mortgage
? What are the requirements to avail of this loan? These are just two of the most frequently asked questions that are running rampant throughout the World Wide Web today. If you have asked these questions then you are probably a senior citizen wanting to avail of such loan. Firstly, reverse mortgage is a type of loan available for old and senior individuals. In this type of mortgage, the homeowner is the senior individual, his or her obligation to pay the loan itself is deferred only in three situations namely until he or she dies, leaves the home or property or until his or her death. The interest in this reverse type of mortgage is not included in the monthly payment of the amortization but instead will constitute as a lien unto the property or home in question.A lien is a form of security interest or right granted to a person or entity that the latter can enforce against the debtor or borrower of the money. Due to this fact, the lender or creditor will have a right on the home or property of the debtor if ever the latter fails to make payments as stipulated in the contract of mortgage or loan. Federally insured reversed mortgage on the other hand, is a reverse mortgage that has been automatically insured through the laws mandated by the federal government. This is particularly true with regard to the reverse mortgages entered into in the United States and Canada, wherein the government takes part in ensuring that the rights and privileges of the senior citizens are protected to some degree or manner.
There are several requirements in order to get a reverse mortgage. Firstly, the age of the senior citizen or individual must at least be 62 years old. This is a mandatory requirement that cannot be waived in any manner. The principle in this type of mortgage is that the older the senior citizen gets then the more lenient the requirements will become for him or her. Secondly, there must be no pending or subsisting loans or mortgages during the application for this reverse type of mortgage. This is mandated by law in order to ensure that creditors and lenders will not be abused by unscrupulous individuals who want to take advantage of this reverse mortgage the unlawful way.
Thirdly, the senior citizen or individual must undergo credit counseling. This credit counseling must be done with an independent third party financial specialist or expert. The latter will explain to the former all of the things that the senior citizen must know, including the contract that the said individual will enter into and the repercussions of abusing or not fulfilling the stipulation or agreement contained in it. This counseling will thus equip the senior debtor or borrower with the right knowledge in order to protect his or her rights and interests. If you are thinking of availing of this kind of mortgage then it's best if you make sure that you fit and have accomplished these three requirements as soon as you can.
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