Business & Finance mortgage

The Disadvantages of a Reverse Mortgage in Texas

    Home Value

    • Reverse mortgages are offered based on how much equity is in the house, or how much value it currently has on the market minus any other associated debts. This is where a Texas-based reverse mortgage may be different based on location. A house in a more active market, such as Dallas/Forth Worth, where house prices tend to be higher, will be able to qualify for a higher reverse mortgage amount. Houses in areas where the market is slower will not quality for the same amount. This varies considerably by time as well, making the amount difficult to determine.

    Final Payments

    • The final payments of a reverse mortgage can be very large. If a borrower dies, the mortgage payments can be a substantial part of estate debts. The house must be sold to satisfy the mortgage, and there could be leftover debt that must be paid in other ways. This amount of the remaining debt will depend partly on the housing market in the area in Texas in which the house is located. Also, the final payment will be higher than the total of a conventional mortgage, because the compound interest tends to build on itself over time.

    Immediate Costs

    • Immediate costs also apply to Texas reverse mortgages. While the debts are delayed, lenders still charge for application fees, closing costs, insurance, appraisals, credit checks and a number of other activities that can cost several thousand dollars or more. This makes starting a reverse mortgage more difficult, especially for those with a low income who may be most attracted to reverse mortgages in the first place. Costs may also be incurred in repairing a home so that it can qualify for the mortgage.

    Age Limits

    • Reverse mortgages are designed for elderly homeowners who have both low debt and low income. Federal rules for Department of Housing and Urban Development (HUD) reverse mortgages restrict application to those age 62 or older. This limits the amount of time a reverse mortgage can be used, but also restricts the amount the homeowner can borrower. Usually the older a homeowner is, the more he can borrower, which can make it difficult for younger owners to borrower as much as they want.

SHARE
RELATED POSTS on "Business & Finance"
Best Buy-To-Let Mortgage Rates To Fit Your Needs
Best Buy-To-Let Mortgage Rates To Fit Your Needs
Refinance Home Mortgage Loan Application Process
Refinance Home Mortgage Loan Application Process
Risks and Rewards of Cash-Out Refinancing
Risks and Rewards of Cash-Out Refinancing
What Is a Lifetime Mortgage?
What Is a Lifetime Mortgage?
Rules for Mortgage vs. Income
Rules for Mortgage vs. Income
Home Loans - Advantages of Home Loans
Home Loans - Advantages of Home Loans
The Definition of Upside-Down Mortgage
The Definition of Upside-Down Mortgage
Federal Rate Vs. 30 Year Mortgage Rate
Federal Rate Vs. 30 Year Mortgage Rate
Mortgage and Security Agreements
Mortgage and Security Agreements
Mortgage Brain and TrigoldCrystal disappointed with OFT decision
Mortgage Brain and TrigoldCrystal disappointed with OFT decision
How to Change Mortgage Companies
How to Change Mortgage Companies
Equity release UK Serves as the Best Opportunity to Earn High Income
Equity release UK Serves as the Best Opportunity to Earn High Income
Seek Pre-approval And Plan Your Mortgage!
Seek Pre-approval And Plan Your Mortgage!
Car Payments Vs. Paying the Car Off
Car Payments Vs. Paying the Car Off
Best Mortgage Rates In Milton - Time To Act Now
Best Mortgage Rates In Milton - Time To Act Now
How To Use A Flexible Mortgage
How To Use A Flexible Mortgage
Can a Lender Take My Salary if I Don't Pay My Mortgage?
Can a Lender Take My Salary if I Don't Pay My Mortgage?
A Stress Free Way To Deal With Property Sales
A Stress Free Way To Deal With Property Sales
How to Get Your Name Off a Joint Tenancy Mortgage If Divorcing?
How to Get Your Name Off a Joint Tenancy Mortgage If Divorcing?
How To Develop A Successful Direct Mail Campaign For Mortgage Applications
How To Develop A Successful Direct Mail Campaign For Mortgage Applications
Home Buyers Highly Motivated, Per Harvard Study
Home Buyers Highly Motivated, Per Harvard Study
FHA Underwriting Checklist
FHA Underwriting Checklist

Leave Your Reply

*