Reverse mortgage eases senior citizens as it is a loan which strengthens their financial capabilities. They only have to put their residential property in order to avail the facility. Hence, they are eligible for a series of series of cash flows for a certain amount of time which is in fact termed as reverse EMIs.
According to national housing board, the tenure is set at 15 years and the house owners along with their spouse continue to enjoy the luxury of living till their death. It needs to occur later to the tenure of the reverse mortgage.Although, the bank will stop the series of payment after 15 years, however as it is said, the inhabitants can surely continue to live till their last breath. There are certain features of this type of loan and they are as follows-
- Any owner of the house who has crossed 60 years can surely apply for reverse mortgage.
- The owner can apply for a maximum 6o% loan of the residential property.
- The period for which the loan is taken stands out to be for a maximum of 15 years.
- The borrower stands out to be at the luxury of either switching over to monthly, quarterly, or even a lump sum at any point of time according to his/her wish.
- The bank has to take the revaluation of the property once every 5 years.
- It is purely the amount in the form of loan which is received through reverse mortgage; hence it does not entertain any type of taxes.
- Finally reverse mortgage can either be fixed or floating. Hence, it will purely depend on the conditions when it comes to choosing the rate of interest by the borrower.
What is the method for you to pay the loan?
Thanks to the reverse home mortgage, no borrower is entitled to pay during his/her life time; hence it is inevitable for the loan balance to rise over time There are certain areas and places, where due to high appreciation, the value of home grows at a much faster and speedy way as compared to loan balance. Hence, the remaining equity grows in an unabated way as well.The changes occur with the demise of one or both the spouses.If in case one spouse dies, the other one can surely continue to live. However, in the event when both of them die, the bank gives the facility of two options to their which are as follows-
- They can settle the due loan and hence retain the ownership of the house, or
- The bank will sell the house in order to settle the outstanding loan by giving the remaining amount to the rest of the heirs.
The age of the person is taken into account as higher the age, higher will be the annuity. Hence, the aforesaid factors are going to ease senior citizens by strengthening their finances especially at such a vulnerable age of their lives.