Are you familiar with reverse mortgages? If you hear about it and its benefits, you might think that the offer is too good to be true.

A reverse mortgage is a type of home equity loan designed for people 62 years or older, and it won’t require monthly repayments. The homeowner still has to settle homeowner’s insurance, property taxes, and other expenses toward home maintenance. Reverse mortgages are excellent for homeowners who want to fund their retirement for maximum comfort.

At first glance, it might seem that a reverse mortgage won’t need a form of repayment. But that’s not true. This article will answer the question for you. How is a reverse mortgage paid if there is no monthly payment? Continue reading to find out.

How Reverse Mortgages Work

A reverse mortgage is different from other home loan products because you don’t have to pay every month until you clear your debt. With reverse mortgages, what you have to look into is loan maturity.

Loan maturity is triggered once you opt to permanently leave your home, sell your house, or transfer the title to another person. If you leave your home for more than 12 months, whether because you will be moving to a nursing home, traveling, or moving into a family member’s house, it will also be considered loan maturity. Loan maturity might also be triggered the moment you default on the loan terms.

At the moment of loan maturity, your mortgage loan will be due and payable immediately.

How to Pay Off a Reverse Mortgage

If you want to repay your reverse mortgage, the easiest step you can take is to sell your home. You can use the proceeds from the sale to pay the reverse mortgage in full. Should there be an excess amount after the sale, you or your heirs can receive any remaining equity.

On the other hand, if the loan balance is larger than what the home was sold for, you can take advantage of Home Equity Conversion Mortgage (HECM) if you are able to get one. A HECM reverse mortgage allows you the added protection of being only responsible for the total amount your home sells for. As it is backed by the Federal Housing Administration (FHA), the FHA will cover the remaining balance you don’t have funds for.

And what if you don’t want to sell the home? There are alternatives you can consider if you’re going to keep the house. For instance, you can refinance the reverse mortgage loan and convert it into a traditional mortgage. Also, you can make use of personal funds and savings to cover the repayment. If there are no funds available, your qualified heirs may also take out the reverse mortgage.

Contact Your Reverse Mortgage Expert in Dallas

For seniors looking to help fund their retirement, a reverse mortgage is one of the best solutions to try. Now that you know the different options to repay this type of loan, you can rest assured that you have many different choices, and you can plan out what repayment strategy you will use as early as today. If you are looking for the best reverse mortgage loan in Texas, talk to us at the Michael Harrell Group. As part of Nationwide Equities, our financial experts are committed to helping seniors like you find the best loan programs and financial solutions for your needs. Please give us a call today at (214) 269-3593 to schedule your reverse mortgage refinance evaluation.

A reverse mortgage can be just the ticket you need to get more out of your retirement. If you are thinking about applying for one, it is important to know all the benefits and how it can be the right financial tool for you.

 Benefits of A Reverse Mortgage

1. Taking out the type of reverse mortgage that is ideal for you. Did you know that there are multiple types of reverse mortgages? A lot of borrowers assume that every reverse mortgage is the same, so researching the different types before they sign on one is very important. But if you do take the time to learn about the different types of reverse mortgages, you can choose the one that will be most beneficial for your scenario. Some examples include HECM reverse mortgages, jumbo reverse mortgages, HECM for purchase loans, and reverse mortgage refinances.
2. Working with a mortgage company that specializes in reverse mortgages. Most mortgage companies offer reverse mortgages, but most also do not specialize in them. Instead, they do most of their work offering regular home purchase loans and do reverse mortgages on the side. The more experience a company has specifically with reverse mortgages, the more knowledgeably they will be able to guide you to choosing the loan product that will help you achieve your goals in retirement. So, it pays off to work with a specialized expert.
3. Think about your plans before taking out a reverse mortgage. There are a lot of questions you should ask yourself about your future plans before you take out a reverse mortgage. How long do you realistically plan to live in your home? Do you want your heirs to be able to live in your home after you are gone? When you carefully examine your future plans, you will know for sure if a reverse mortgage is right for you.
4. Choosing the right disbursement option. Did you know that you can claim the funds from a reverse mortgage as a lump sum, a line of credit, or in installment payments that are deposited directly into your account every month? Each of these different disbursement options features distinct pros and cons, and each is suitable for different scenarios. It’s best if you learn about their advantages and disadvantages, so you can choose the disbursement option that will be the best fit for your needs.
5. Talking to your heirs. What do your heirs want to do with your home after you are gone? Are they likely going to want to sell it or keep it? If you do not have this conversation with your heirs, you are never going to know. A lot of people assume that they know what their heirs would want. But surprisingly, your heirs could be more attached or less attached to your home than you think. So, it is best to bring up your thoughts about a reverse mortgage with your heirs directly before taking one out. Ask questions about what they may want in the future.
6. Maximize your income with a reverse mortgage. Many people who take out reverse mortgages are simply taking the option that is going to maximize their income during their retirement years. So, if you are looking to do the same, it is well worth looking into a reverse mortgage to explore the possibilities.

Contact Michael Harrell Group Today

Now you know some valuable tips that help borrowers when they are thinking about taking out a reverse mortgage. Michael Harrell Group can walk you through your application and help you make the choices that are right for you. To get started now, please give us a call today at (214) 269-3593.

Have you ever known a senior neighbor who’s just enjoying their life in retirement when they suddenly decided to buy a new home? At first, you must’ve thought they saved a lot of money for retirement to do that. But the more probable answer is they probably used a reverse mortgage to buy a new principal residence. That’s all possible due to the power of a home equity conversion mortgage (HECM). If you’re curious about how a reverse mortgage works, here’s what you need to know about it.

Why Buy a New Home as a Senior?

Whether you’re retired or just thinking ahead as you approach your retirement age, having a huge, multiple-level home sounds great and all, but it can be too much if only a few of your family members are living there. Eventually, some of them will decide to move out and have their own families. You may want to consider settling in a smaller house, which is easier to maintain and manage. Some people would like a smaller home that’s cozy and comfortable enough but can also cater to their new physical needs with ramps or handrails. Whatever your reason may be, there is a viable option available to you for aging in a new home instead of your current one.

What Is HECM for Purchase?

A HECM for Purchase loan allows borrowers to obtain a reverse mortgage and buy a new property within a single transaction. It’s essentially combining the process of home-buying and loan application into a single transaction that’s quite simple to follow. Borrowers who opt to obtain a reverse mortgage are able to buy a house without paying monthly mortgage payments all because of the equity they’ve earned.

However, with a HECM for Purchase, a down payment is required that amounts to about half of the new home’s purchase price. Now the question is, where will you get the funds for the down payment?

Down Payment Funding Sources

In a reverse mortgage for purchase, the borrower provides a down payment using the sale of the previous home or other savings. The equity earned through the down payment and the new home’s value is then used to calculate the reverse mortgage loan amount. This could actually help you save your personal funds that you would otherwise use to purchase a property using a typical mortgage application. Instead, you can use that money for other means. However, there are a few things you need to remember when initiating this kind of transaction:

• You may only use your own money or money obtained from the sale of a previous home.
• Withdrawal from your savings or money gifted to you by someone else is also acceptable.
• You can’t use any borrowed money through bank financing or from a family member.
• Borrowing against an asset like your life insurance policy is also not permissible.

During this process, you may need to meet the loan-to-value ratio requirements with a significant down payment and provide verification of your personal income and funds. Finally, all or part of the reverse mortgage funds then covers the remaining cost of the home, just like with a traditional mortgage.

Your Reverse Mortgage Expert in Dallas

A reverse mortgage for purchase or HECM for purchase transaction is often used by people who want to move into a new home in which they plan to age in place and live in a simpler and more manageable place of residence. If you’re at least 62 years old and you want to apply for this type of mortgage, all you have to do is find a lender you trust and talk to them about having a reverse mortgage.

Michael Harrell of Thinkingreverse LLC is here to help you get the guidance you need to fully understand how a reverse mortgage works. Instead of working it out all on your own, getting personalized advice from a reverse mortgage expert is much easier. If you want to schedule a reverse mortgage consultation, contact Michael Harrell Group today at (214) 269-3593. We work with customers in Dallas and throughout the state of Texas.

The process of planning for retirement is an experience that’s chock-full of varying events and pertinent details.

Regardless of what your aspirations may be or what your plans are in the long run, you will realize that planning for your life after work involves many details. From investments to compensate for the absence of income to healthcare plans for long-term care, the factors to consider and deal with are nearly endless.

And the most important of all these details? Purchasing the home you’ll spend the rest of your post-work life in.

A Solution Worth Looking Into

Admittedly, preparing for your future home can be a rather intimidating task because of how much money, research, and planning is involved.

With home costs rising and listings being swept up by fast-acting buyers left and right, it’s important to start planning and acting promptly when securing your retirement home. From location matters and structural preferences to set budgets and long-term values, there is much to worry about before finally investing in a property you can enjoy in your older years.

But while you may be wondering about how you’re going to buy your property above all else, there’s one solution that can help immensely: A HECM for Purchase.

Basic Introductions

A Home Equity Conversion Mortgage (HECM) for Purchase—as complicated as it may sound, it is rather straightforward and actually easy to understand.

Simply put, these types of financial solutions are a type of reverse mortgage that is insured by the Federal Housing Administration (FHA), allowing seniors to convert their home equity into cash. Through the years, this option has become popular because of its applicability to most conditions and situations.

Based on current guidelines, the amount that may be borrowed to buy a home with a HECM for Purchase is based on the home’s appraised value while being subject to FHA limits.

Available to borrowers sixty-two years old and older, this approach works by having money advanced against the value of the equity in the home as interest accrues on the outstanding loan balance. It’s worth noting that no payments are made until the home is sold, is no longer a borrower’s primary residence, or if the borrower dies—which means a loan must be repaid entirely.

How Does It Work?

One great thing about HECMs for Purchase is that they allow borrowers to choose to repay as much or as little as they’d like to each month. The result of this system is a buyer’s advantage as it allows them “right-size” to the home they want—all while keeping in stride with their financial and retirement goals.

Can You Apply?

Currently, the FHA offers and sponsors the home equity conversion mortgage while providing insurance on the products—allowing them to set the guidelines and eligibility for these options. However, qualified borrowers need to understand that they can only obtain HECMs from lenders that are approved to offer these products.

To be considered for a HECM for Purchase, applicants or interested and near-retiring homebuyers must abide by these key qualifications:

• Must be sixty-two years of age or older
• Must occupy the property as your principal residence
• Must not be a delinquent on any federal debt
• Must possess financial resources to continue making timely payment of ongoing property charges such as taxes, insurance, homeowner association fees, etc.
• Must participate in a consumer information session given by a Housing and Urban Development-approved HECM counselor

When it comes to properties, these are the set standards that a proposed listing must possess:

• It must be a single-family home or two- to four-unit home with one unit occupied by the borrower
• It must be a HUD-approved condominium project
• It must be a manufactured home that meets FHA requirements

(If you want to learn more about how you can use a HECM for purchase to right-size your way to a post-work life home, we’re here to help!)

Contact Michael Harrell Group Today!

When it comes to purchasing homes to retire in, few come close to the type of opportunities and advantages that HECMs for Purchase provide. Once you get to use this particular financial solution to your advantage, you can leverage the power of well-structured systems enough to finally acquire a great listing!

If you’re looking for the best HECM reverse mortgage in Texas, the Michael Harrell Group has you covered. Get in touch with us today at (214) 269-3593 to learn more about our services!

Are you thinking about getting a reverse mortgage, but are not sure whether you should do so now or wait a few years?

Trying to figure out the timing for a reverse mortgage is not always easy. But a good starting point is to learn more about the advantages and disadvantages of waiting versus taking one out right away.

The Benefits of Waiting to Take Out a Reverse Mortgage

If you expect your home value to increase, it might make sense to hold off before you apply for a reverse mortgage. You could qualify for more with a higher home value in a few years than you would today with a lower home value.

The Drawbacks of Waiting to Take Out a Reverse Mortgage

Home values do not always continue to rise. Sometimes, they drop. If you wait, and home values decline, you might not qualify for as much when you apply for a reverse mortgage. The same may be true if there is an increase in interest rates.

Additionally, you will be missing out on some of the prime advantages of taking out a reverse mortgage right away. See more below.

The Benefits of Taking Out a Reverse Mortgage Now

Say you decide to take out your reverse mortgage as an HECM line of credit. That line of credit grows at a guaranteed rate—specifically the part of it you are not using.

So, taking out a reverse mortgage well before you need it can pay off considerably in some situations.

But let’s also consider the fact that if you do end up needing it sooner than you expect, the money will be there waiting for you, rather than needing to go through the process of applying first.

Also, do not forget all the ways in which a reverse mortgage can enhance your life during retirement. Contrary to what a lot of people believe, you do not need to be desperate for cash to benefit from a reverse mortgage.

Even if you do not “need” the money, you can buy things you want with it, like upgrades to your home.

There’s no point in putting off such upgrades. The sooner you pursue them, the longer you can enjoy them.

The Drawbacks of Taking Out a Reverse Mortgage Now

The main potential disadvantage of taking out a reverse mortgage right away would be if you could qualify for more later, as discussed.

But sometimes, even if your home value is going to end up increasing, you might still get more money now by applying for a reverse mortgage right away and watching it grow.

The Michael Harrell Group Can Help You Weigh the Pros and Cons of Taking Out a Reverse Mortgage Now or Later

With so many factors at play, it can be difficult to figure out on your own if you should take out a reverse mortgage right away or if you should wait.

The Michael Harrell Group can help you look at all the individual factors in your case to decide about the most advantageous course of action.

To schedule your consultation now, please give us a call at (214) 269-3593. Let’s help you get the most out of your retirement with a well-timed reverse mortgage.

When managing your assets and checking any debt that you need to pay off, you may start to wonder what moves you can make to give you a more optimal financial position. Loans are a great way of rearranging the terms and circumstances that you’re facing.

There are all sorts of loans available on the market, but almost every homeowner near the age of retirement has probably heard of reverse mortgages. How it’s advertised makes it sound like quite an attractive loan, but that’s why it sparks questions of what it is and whether it’s a viable option.

Continue reading to dive into how a reverse mortgage loan would be good for you.

Learning Reverse Mortgage’s Definition

A reverse mortgage is defined as a loan where the homeowner can borrow a part of their home equity from a lender. The payment would be given in a lump sum, though you can discuss the possibility of monthly payments. Reverse mortgages would only require the loan to be paid back after the house has been sold by you or any heir who inherits the property. 

The requirements for getting a reverse mortgage loan are that the borrower must be 62 years old and that they must have a property. Certain loan programs like HECM will have other eligibility requirements. Generally, though, the terms and conditions can vary depending on the lender you’re speaking with, so be sure to talk to someone reputable.

Many homeowners have found reverse mortgage loans to be extremely helpful, and for good reason. Since you’re getting payments instead of paying the money, you’d be able to cover any pending debt or keep your finances afloat. There are also other benefits, such as:

• Your Retirement Is Secured. Those in their 60s can liquidate their home’s value and get the cash they need for their retirement plans. The amount you get coupled with the savings you’ve put away will allow you to live comfortably.

• You Keep the Home for Now. An alternative that some homeowners may think of in order to get cash is to sell the home. However, reverse mortgages allow you to get some money while you continue to stay on your own property. 
• You Reduce Tax Liabilities. Certain loans come with a number of tax liabilities that can shave off the amount that you get in the end. However, reverse mortgages are classified as a loan advance, which is different. Your funds from this transaction wouldn’t be taxed.

Applying For A Reverse Mortgage With Thinkingreverse Michael Harrell Group

There are many factors to consider when it comes to a reverse mortgage loan. A homeowner will have to decide whether the loan program’s setup is well-suited for their situation and needs. Don’t hesitate to seek advice and discuss with a lender. 

Looking for the best reverse mortgage in Texas? Thinkingreverse Michael Harrell Group is a reverse mortgage direct lender that helps seniors find the best solutions and loan programs for their needs. Get a quote today by calling (214) 269-3593!

The adage that reverse mortgages should only be used as the last option is not valid anymore. Nowadays, they can help you improve your retirement income plan in a number of ways.

Before we discuss a few specific ways a reverse mortgage can benefit you, here’s a little definition of this mortgage type: If you are at least 62 years old, a reverse mortgage is a means to turn the equity in your principal residence into a usable resource. It’s essentially a reverse mortgage. The lender offers you a sum based on how much equity you have in your house. Payback is not required, unlike a regular mortgage. However, you must pay your property taxes and homeowners insurance on time.

There is a healthy cynicism of reverse mortgages, which isn’t always bad because individuals should be cautious when using debt. Reverse mortgages, on the other hand, can help you spend more wisely in retirement. 

Four Ways a Reverse Mortgage Can Help You Make More Money in Retirement

1. Coordinated Spending with Your Portfolio. One of the biggest concerns for retirees taking withdrawals from their investment portfolios is experiencing a period of negative stock market returns in their early years of retirement. These retirees may be forced to sell investments at inconvenient periods because they need to use the portfolio to cover living expenses. Because of a feature called a standby line of credit, reverse mortgages can assist lessen this risk. A set of criteria determines your credit line, including the mortgage size, your age at the time of loan origination, and interest rates. Someone with a $500,000 mortgage-free home could get a reverse mortgage line of credit worth roughly half of his home equity. This line of credit can be used as a safety net in the early stages of retirement to protect against poor portfolio performance. Depending on the market climate, you can synchronize spending between your portfolio and your reverse mortgage.
2. Supplemental Income for Postponed Social Security Benefits. Many financial advisers recommend clients wait as long as possible before filing for Social Security benefits, up to the age of 70. This is because delaying claiming between the ages of 62 and 70 increases payments per year. However, because you can collect Social Security payments as early as age 62, someone could be without a stable source of non-portfolio income for up to eight years. In this situation, setting up a reverse mortgage with an eight-year term payout is one option to consider. It can give a “bridge” income to replace all or part of the income provided by Social Security.
3. Providing Heirs with Larger Inheritances. You might believe that a reverse mortgage’s initial payments and compounding interest would considerably diminish an inheritance you want to leave your heirs. This could be true, but it isn’t always the case. Closing charges, a mortgage insurance premium, and origination fees are all upfront costs. While the sum of these costs may appear considerable, keep in mind that the residence is a single asset with no diversification. Instead of a diversified stock portfolio, using the property to provide retirement income could result in a more significant overall inheritance. One of the benefits of a reverse mortgage that is often overlooked is that it acts as a protective hedge against the value of your home. In other words, regardless of the value of your home, your borrowing capacity grows. Michael Harrel quoted “You can continue to generate retirement income even if the value of your property drops. Your heirs will not be liable if the house needs to be sold in the future, such as after the second spouse’s death.”
4. Contingency Fund for Unexpected Expenses. You may face unexpected bills in retirement. Your health may deteriorate, which requires long-term care. In such cases, having access to a reverse mortgage line of credit could be highly beneficial. A reverse mortgage is often better suited to pay for in-home care rather than nursing home care when it comes to long-term care costs because you might not be able to maintain a reverse mortgage active for more than a year if you’re in a nursing home.

Michael Harrell Group: Applying for a Reverse Mortgage in Dallas

Reverse mortgages offer a great deal of flexibility. They’re a terrific method to meet your specialized retirement-related needs. While they aren’t appropriate for every situation, they are a financial instrument to consider if you need access to disposable income in your retirement years.

If you are looking for a reverse mortgage lender in Texas, you have come to the right place. Michael Harrell Group will offer you the best option for your needs. Request a quote today!

In recent years, the reverse mortgage has become a crucial fixture of the modern American real estate market because of the opportunities it provides. Often associated with earning money on existing assets and providing an alternative source of income, these types of plans have become a hot topic of discussion among most senior American homeowners today.

With many forging their tales of financial comfort and success with these plans, it’s only natural that you look into the prospect of using them as well! Whether you own a condominium unit, mansion, bungalow, apartment, or mid-sized townhouse, the opportunity to use a Home Equity Conversion Mortgage (HECM) reverse mortgage is as tempting as it gets.

A growing number of lenders are offering this opportunity, and many homeowners are vouching for it, so chances are you have one question in mind: What are the actual benefits that I can get out of using a reverse mortgage?

Key Advantages of Reverse Mortgages

The premise of the HECM reverse mortgage is relatively straightforward. It is built to eliminate traditional mortgage payments and helps property owners obtain additional monthly income. Through this financial product, you can access your home equity while you live in the home, making it a valuable opportunity worth looking into.

Many are still unaware of the benefits they can stand to enjoy—and this may include yourself. To best illustrate why it’s worth looking into, consider enlisting the services of an expert like Michael Harrell Group’s professionals to help you get started!

Here are some vital benefits to watch out for:

1. Distinct Levels of Flexibility. A reverse mortgage is something that any homeowner should use because of how easily it can be tailored to their needs. A key benefit of the HECM Reverse Mortgage is that it’s a significantly flexible loan product that can be utilized in various ways. For instance, households with a financial need can adjust the reverse mortgage for increased income; conversely, households with adequate resources might consider it a financial planning tool to secure their future!
2. Little-to-no Downsides. Thanks to the way that it’s built and the kind of system it follows, the average HECM reverse mortgage comes with very few downsides. When you start looking into this loan product, you’ll realize that you’ll never owe more than your home’s value. The lack of downsides makes reverse mortgages especially helpful in the event that home value decreases!
3. Significantly Lower Risks of Default. One of the most common reasons homeowners pass up on a reverse mortgage is that they think they’ll lose their home over a simple mistake. However, this isn’t the case. The HECM reverse mortgage program—by law—states that your home cannot be taken from you in the circumstances outlined by a non-mortgage payment. This makes it a much more desirable option compared to home equity loans because you won’t have to worry about monthly repayments or payment term permanency!

Apply For a Reverse Mortgage at Michael Harrell Group Today!

Conclusion

You can capitalize on many financial opportunities in your lifetime, and it’s time to consider investing in a reverse mortgage. Through the help of this loan product, you’ll be able to leverage your most significant asset to your advantage and have a much easier time establishing your financial comfort! 

At Michael Harrell Group, we take immense pride in providing the best HECM reverse mortgage in Texas. Contact us today at (214) 269-3593 to learn more about our services!

Taking out a reverse mortgage lets you borrow against the equity in your home for extra cash flow during your retirement years. While the main benefits of reverse mortgages are financial, there are also advantages that go beyond finances. Let’s take a look at a few of these now.

Benefits of Reverse Mortgage

1. More peace of mind. One reason a lot of seniors take out reverse mortgages is to enhance their peace of mind. If most of your money is tied up in your home, you may not have much in the way of emergency funds if anything unexpected happens. This may leave you feeling anxious in case anything does. But when you take out a reverse mortgage, you will have that extra cash as a protective buffer in case of an emergency or even just a month that is more expensive than usual. As a result, you can relax and enjoy your life more, worrying less about finances.
2. Know your investment is working for you. Over the years you have paid off your mortgage, you have worked hard to own your own home. That is something to be proud of. While owning your home is its own reward, a reverse mortgage allows you to have that investment pay off in other ways. That can be an additional rewarding feeling to enjoy.
3. Less stress about everyday finances. Currently, you may not only be concerned about what you would do if an unexpected emergency were to crop up, but also about making ends meet from month to month. Living on a tight monthly budget can lead to chronic stress. Even at a low level, that type of stress can take a toll on your physical and mental well being. Your reverse mortgage can pad out your monthly budget so that you no longer need to worry about paying your bills. You might even have some extra left over for additional, optional expenses. The result is that your stress levels should reduce. You may feel better psychologically and even physically.
4. Do the rewarding activities you always dreamed of. How many items on your bucket list have you managed to tick off by this stage of your life? How many more are left to go? Knowing you have accomplished your dreams or participated in activities you enjoy can contribute to a feeling of satisfaction with your life. With a reverse mortgage, you may have the funds to check off more boxes on your bucket list, leading to greater overall life satisfaction.
5. Enhance your home. With a reverse mortgage, you can make repairs or upgrades to your home. Those improvements can contribute to your quality of life every day going forward. There is no better time than the present to put in that hot tub you always wanted, or to go solar and save on energy bills.
6. Support those you love. One more way in which a reverse mortgage can provide rewards that go beyond finances alone is by giving you the means to support important people in your life. For example, you might use reverse mortgage funds to help a grandchild afford attending a university. Being able to give to others is a good feeling. You might also simply use your reverse mortgage funds as a way of spending more time with loved ones. For example, they might give you the means to take more trips to visit your family members. While you can put a price on a train ticket, sharing experiences with those you love is priceless.

Apply Now for a Reverse Mortgage in Texas

Are you ready to experience greater peace of mind, less stress, and more rewarding golden years? Michael Harrell Group can help you apply for a reverse mortgage in Dallas or anywhere in Texas. To get started now, please call (214) 269-3593.