For millions of Americans, owning a home means much more than just having a place to live. A home can also be one of your biggest assets, and understanding
how to use that asset to its fullest is important. While it’s not for everyone, using a reverse mortgage in Colorado could help the state’s residents get some significant benefits – if they feel that the option is right for them.
To figure out whether or not you should contact a reverse mortgage specialist, the first step is simply to understand the basics of how
it works. Here’s a quick, basic breakdown of the fundamentals of what it involves.
- If you are considering taking out a reverse mortgage in Denver CO you should speak to a specialist who will review your situation and ensure that you
qualify and understand the reverse mortgage program. If you do, the next step will be to talk with a reverse mortgage housing counselor.
- Meeting with a reverse mortgage counselor is required prior to signing an application for a reverse mortgage. The counselor is an independent
third party approved by the Secretary of Housing and Urban Development (HUD).
- The next step is to meet with the reverse mortgage Colorado specialist to complete the application.
- Your home will then be appraised by a professional. That appraisal is used to determine overall value. You will then talk with the reverse mortgage
specialist again to discuss how the actual appraised value affects your reverse mortgage.
- Once the loan is approved, you sign the final papers and after a 3 business day waiting period, the loan is final.
- Under a reverse mortgage, you have 4 ways in which you can receive the funds:
- As a Lump Sum
- A Line of Credit
- As a Monthly Payment
- Any Combination of the Above Choices
- A reverse mortgage only comes due when the last homeowner permanently leaves the home. At that time the heirs inherit the home and they decide
what to do with it. If there is equity left in the home, they can sell it or refinance it and pay the reverse mortgage off. Any remaining
equity will go to them.
If there is no equity left in the home, they can give it to the lender and walk away. There is absolutely no recourse. The lender
cannot come back to the heirs, or the estate for any loss.
- As the homeowner, when you get a reverse mortgage, the home is still in your name. It is your house. You can sell any time you choose.
You are not “stuck in the home”. However, since it is still your home, you still have the continuing obligations of any homeowner.
In order to keep the reverse mortgage in place you must continue to:
- Live in the home as your primary residence
- Pay your property taxes on time
- Keep up on your homeowner’s and/or flood insurance
- Maintain the home
In short, you’ll speak to a Colorado reverse mortgage specialist who will help you to understand exactly how reverse mortgages work as well as go over the various options so that you can make an informed decision
if it’s a program that is right for you. That’s it in a nutshell, and reviewing its basic principles it’s not hard to see why so many people
are turning to this option.
So who is a reverse mortgage really good for? Primarily, it’s the right call for those who:
- Are concerned about outliving their money. They might have some saving but it may not be enough.
- Someone who has a mortgage on their home and does not want to pay it month after month for the rest of their life.
- Someone who might have plenty of money but wouldn’t want to withdraw it in a down market. You can set up a “stand by line of credit” to
tap into during a down stock market.
- Anyone who wants to improve their standard of living by paying off a mortgage, receiving a monthly check or having the peace of mind of knowing that
they have money set aside in a line of credit for emergencies.
If you feel like a Colorado reverse mortgage is right for you, it’s something that’s well worth taking a closer look at. It’s a unique
kind of loan that offers a lot to many people, and could change your life in a big way.