Is A Reverse Mortgage Right For You?

We often get questions from clients who have seen or heard something about a reverse mortgage on TV or radio ad.  In this blog post we’d like to explain what a reverse mortgage is and if it might be right for you.

What exactly is a reverse mortgage?
A reverse mortgage is a home loan that lets you turn a portion of the equity in your home into cash payments or line of credit, usually to supplement a retirement income.  In other words,  instead of making monthly payments to a lender, as one would do with a traditional mortgage, the lender makes payments to the borrower.

A reverse mortgage is also often referred to as a home equity conversion mortgage or (HECM).  Borrowers must be 62 years or older and live in the property as their primary residence for the life of the loan.  Although no mortgage payments are made, borrowers are still responsible for paying taxes and insurance on the property.

Are reverse mortgages safe?
As with any loan, a reverse mortgage requires careful consideration before making the decision to obtain one.  At Capital Mortgage Boise, our experienced mortgage agents can answer your questions and make sure you understand the obligations and considerations of a reverse mortgage.

Are reverse mortgages a good idea?
Millions of homeowners have and are using reverse mortgages to supplement retirement income or as part of their retirement planning strategy.  Another advantage of getting a reverse mortgage loan is that borrowers can use their cash payments in any way they choose.

Can I use a reverse mortgage to upgrade?
Yes, one advantage of using a reverse mortgage to purchase your retirement home is being able to afford a more luxurious home. For example, if you have $250,000 cash to purchase a home with, you can either buy a $250,000 home and never have another mortgage payment again, or you can use it to purchase a $500,000 home and never have another mortgage payment again as well.

Reverse Mortgage Myths.

MYTH 1:  A reverse mortgage is essentially selling your home to the bank.   FALSE
Reverse mortgage borrowers never give up title or ownership.

MYTH 2:  Reverse mortgages have high costly fees.   FALSE
Interest rates are comparable to conventional FHA rates.  Fees vary by lender

MYTH 3:  You must own your home free and clear to qualify for a reverse mortgage. FALSE
You don’t have to have it paid off, but you do have to have a low balance.  Many borrowers use the loan proceeds to pay off the existing mortgage.

MYTH 4:  Reverse mortgages are meant to be a loan of last resort. FALSE
While reverse mortgages may be the last resort for some, most borrowers today, use their reverse mortgages as another financial tool, or so that they are prepared in advance for any potential future financial difficulties.

If you are interested in a reverse mortgage or want to find out if you qualify, please contact us today by calling


Or Contact Us Online Using The Form To The Right.