I don’t know if this kind or style of loan is already being offered here in the Philippines, I guess I have to search about it later but it is very much available and popular in other countries like United States. It started in the 1970’s I gathered, to help seniors remain in their home by using their homes’ equity to pay off the mortgage. Through the years, it changed and has grown so popular.
Reverse mortgage allows you to access a portion of the equity in your home to obtain tax-free cash without having to make monthly loan payments. Now that sounds so good right? But is it safe? Yes, it is according to Federal Housing Administration, it is safe.
I like how they thought of the seniors with this style of loan, they said it was signed into law way back in 1988 for the seniors to enjoy their retirement years. Not everyone though is eligible, there are some basic requirements like you must be 62 years old or older.
Reading through the frequently asked questions section of a reverse mortgage site, I learned that they would not take the title of your property, so it remains to be in your hand and your heirs will still have that property as inheritance after the balance of your reverse mortgage is paid off. And if you still have questions, there is a reverse mortgage counselor you can talk to so you can have all your worries and queries discussed with him or her.
I hope this help someone who is currently thinking of getting such kind of loan. I am actually thinking of a loan right now but it’s a totally different kind of loan but I do hope this would be made available here someday so when I’m on my senior year I can apply for my self.