Reverse Mortgages
Traditional Mortgages

There is much talk these days about reverse mortgages. They can be a great way for senior citizens to take control of their finances or get items they need without taking on another monthly payment. But how do they differ from traditional mortgages?

First, letís take a look at a traditional mortgage.

Regular mortgages are obtained to buy a home. First the home must be inspected for certain problems and appraised to ensure that it is worth the amount of money the lender will be loaning you. You must also provide proof of income and go through a credit check so the lender knows that you have the means to pay it back and a reasonably good track record of paying your debts in a timely manner.

You must also decide whether you want to get a fixed rate or adjustable rate mortgage. The best one for you will depend on your particular situation. Once you have been approved for everything and decided which type of mortgage you want, you can close the deal.

After all of the paperwork is done, you are ready to begin making your monthly payments. In the beginning the lionís share of each payment will go toward interest. As you continue to make payments, more and more of the money will go toward the principal. This results in greater equity in your home. Once you have paid the mortgage in full, you have 100% equity.

Now, letís look at a reverse mortgage.

Reverse mortgages are only available to persons who are 62 years of age or older. They allow you to borrow against the equity in your home. But unlike a regular home equity loan, you do not have to pay the money back in monthly payments. As a matter of fact, it doesnít have to be paid back until you move out, sell the home, or pass away.

Getting a reverse mortgage is fairly easy. As long as you are over 62, own your home, and have either paid your original mortgage in full or can pay it off with the proceeds from the reverse mortgage, you probably qualify. Since there are no monthly payments, there are no income requirements to get a reverse mortgage.

In general, the home must be sold to pay back the loan. If the owner dies while still living in the home, the house is usually sold to pay off the mortgage. Any funds beyond those owed will go to the homeowner's estate.

The opposite of what happens in the traditional mortgage process occurs with a reverse mortgage. Instead of gaining equity in your home as you lower your debt, you are losing equity in your home as you increase your debt.

As you can see, the reverse mortgage is aptly named. It allows seniors to tap into the equity they have in their homes and use it for anything they need. In exchange, the lender gets a portion of the homeowner's equity.

If you would like more information about the reverse mortgage process and how it can help you live out your retirement without the stress of financial burdens please call me or one of my team members at 877-787-1003 or send an email here:

We will be happy to provide a complete complimentary analysis of the amount of money you could expect to receive from the best available products.


James Barath, CMA, CMPS

Phone: 877-787-1003
Fax: 888-797-9062 

 Photo of James Barath, CMA, CMPS

James Barath, CMA, CMPS
Reverse Mortgage Specialist


Phone: 877-787-1003

We hope this site has been helpful. Please allow us to handle your Reverse Mortgage for you when you are ready.

Equal Housing Lender | Canopy NMLS 1359687

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