How it Works

reverse mortgage calculatorHome ownership has always been a reliable way to build personal wealth. Over the years you’ve been happy to watch the value of your home increase while at the same time your monthly mortgage payments have steadily decreased or you have even paid off your home loan. The house that you purchased has become your home, you are comfortable there and would like to live your retirement years there.

Like many seniors on fixed or reduced incomes you may be facing some unforeseen difficulties with bills and healthcare expenses. You may be reluctantly considering selling your home, knowing that continuing to live in it will only increase your financial burden.

The experts at Lineage Lending know that many retired homeowners have equity built into their homes that often goes unused. A reverse mortgage allows you to draw on the equity in your home without having to sell it. Think of it as a reversal of a conventional mortgage that allows you to retain ownership and title to your home, while providing monthly loan advances, rather than requiring monthly payments.

The cash you can potentially receive is based on the age of the youngest borrower, the current expected interest rate, the mortgage option selected, amount of home equity and the appraised value of the home. For instance an older individual with a higher value home typically will be eligible for more than a younger person with the same home value at the same expected interest rate.

Reverse mortgage payments can be received in one of five ways:

  1. Tenure: equal monthly payments
  2. Term: equal monthly payments for a fixed period of months as decided by the borrower
  3. Line of Credit: payments made in installments or at various times and in amounts dictated by the borrower(s)
  4. Modified Tenure: monthly payments with a line of credit
  5. Modified Term: monthly payments for a fixed period of months with a line of credit

As a borrower you must continue to pay property related fees such as, taxes and insurance, and must maintain the home in good condition. You can use the cash payments as you wish: to supplement your retirement income, make home improvements, pay bills, or vacation. It’s all up to you.

The loan is repaid when you either sell your home, the last borrower passes away or you no longer live there as your principle residence*. How much money you can take in the first year is limited. For more information on distribution limits go here.

Call Lineage Lending and let us make a full assessment of your available equity and your specific financial requirements. We will meet you at your convenience in your home and fully explain the process, reverse mortgage pros and cons and use our reverse mortgage calculator to give you a free quote!

It’s your money. Put your hidden financial strength to work for you.

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*There are some circumstances that will cause the loan to mature and the balance to become due and payable. Borrower is still responsible for paying property taxes and insurance.