Chris Lamm Mortgage

reverse mortgage in Redding, CA
It’s one of the most common complaints about reverse mortgages in Redding, CA, and also one of the most easily addressed. The borrower passes away, the loan payments are triggered, and the estate heirs become responsible for everything.

For some people, this is a rallying cry against the reverse mortgage industry in general. But the truth is, bringing your family into your retirement planning is an immediate, preventative fix. As long as your family knows how your retirement has been structured and where the equity stands, there won’t be any confusion.

In an effort the help with the process, we’re presenting some of the basic must-know tips for heirs when it comes to reverse mortgages.

When is a Reverse Mortgage Loan Triggered?

If a reverse mortgage loan is taken out by more than one person (as is the case with many married couples and partnerships) the terms of the loan state that the loan does not become due until both borrowers have died. In other words, when one spouse dies, the other can continue to live in the house with the loan terms unchanged.

However, after both borrowers have died, it’s time for the loan to be paid off. If the properties are being inherited by children or family heirs, then it will up to them to make the loan payments.

Is it Better to Sell a House with a Reverse Mortgage On It?

One of the first things that family heirs have to decide is what to do with the house. Depending on the amount and terms of the original reverse mortgage, there might not be much equity left in the property. In some cases, the loan amount exceeds the value of the house altogether, leaving the heirs with the bill.

However, this never needs to be the case. As long as you are applying for a regulated HECM reverse mortgage, it will not be possible to take out more than the value of the property.

If there is equity left, then the heirs might simply sell the property, receiving only the portion of the sale cost which they are entitled to. In many cases, the heir simply hands the keys over to the lender, as 100% of the equity now belongs to them.

Talking to Your Family About Reverse Mortgage Loans

Here’s the deal: reverse mortgages let Redding, CA homeowners reclaim control of their own assets. They allow millions of Americans to borrow against their hard-earned equity. From home improvements to vacations, this money  should be available to the homeowner.

When families have problems with reverse mortgages, it is almost always because they come as a surprise. By bringing your family into your retirement planning, you can eliminate any possibility that they will be caught off guard after you pass away.

If you’re thinking about applying for a reverse mortgage in Redding, CA, be sure to speak with an advisor before committing to anything. Rates can vary, so it helps to be as strategic as possible.

Questions? Contact Chris Today!

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Chris Lamm

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Redding, CA 96002
Phone: 530-282-1166
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