Texas Reverse Mortgage
 he amount of reverse mortgages originated in Texas is growing, passing Florida for the second most nationwide but still behind number one ranked California, where 13% of these loans are located. Reverse Mortgages are increasing in popularity with Texas seniors who have equity in their homes and want to supplement their income.
Reverse Mortgage Basics
The Texas reverse mortgage was designed for seniors who must be at least 62 years old, to access a portion of the equity in the home for cash. No repayment is required until borrowers no longer use the home as a principal residence or do not meet the obligations of the loan.
Reverse mortgage loans are not without their risks. In 2008, Florida senior citizens complained about several mortgage scams that target the elderly. Predatory lenders can often engage in deceptive practices and use sales tactics to steer borrowers into improper loans.
The lender can't take the home as long as you or one of the borrowers continues to live in the house and keeps the taxes and insurance current. You can never owe more than the value of your home at the time you or your heirs sell the home.
If you are age 62 or older and own your home or condominium, you are eligible for a reverse mortgage. It does not matter how much income you make or what your credit history is. Even if you have a current mortgage, you can still obtain a reverse mortgage. However, you would have to use the proceeds from your reverse mortgage to pay off your existing mortgage.
Texas Reverse Mortgages Are Increasing
Still, reverse mortgages are becoming more and more popular throughout Texas. In 1999, the Texas Legislature amended the State constitution to authorize reverse mortgage lending. Since 2008, senior citizens in Texas have borrowed more than $2 billion dollars.
More Texas reverse mortgages could be coming soon. The real estate center at Texas A&M University estimates that by 2030, over 5 million Texans will be over the age of 62.
Getting The Equity Out Of Your Home
A reverse mortgage is a loan for approximately 40-65% of the appraised value of your home. The appraised value of your home, the current interest rate, and your age are the factors that determine the amount you would receive. You do not make payments on the loan during your lifetime. The money received from the loan, in addition to a low interest rate amount, is paid back when the last surviving spouse of the estate has passed on or has permanently left the home. The funds to make the payment usually become available at the sale of the estate.
Reverse mortgage proceeds are available as a lump sum, fixed monthly payments, or both. In many cases, those who obtain a reverse mortgage receive a substantial amount of cash within 30-60 days. You retain 100% ownership and the future appreciation of your home.
If you already have a mortgage on your home, you can still acquire a reverse mortgage. You would have to pay-off the balance of your existing mortgage loan with the funds that you receive from your reverse mortgage loan. This would eliminate your regular monthly mortgage payment, thereby increasing your monthly income.
If you're in the market for a reverse mortgage, see what our Special Providers can do for you.
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