Time and again, financial advisers say that planning ahead of time is crucial. However, there are still many people who have reached the retirement age and are facing different financial predicaments, such as increased medical bills, delayed social security benefits, and withdrawal penalties. To answer these issues, one of the easiest options is to take on mortgage offers for retired seniors.
In recent years, most creditors and borrowers are affected by the meltdown of the mortgage value, which results in the difficulty of qualifying for any mortgage option. Seniors are often hardest hit by this due to their fixed or limited income and the availability of federal programs that can help them. However, there are still several good mortgage options which many seniors can apply for.
This mortgage option is ideal to be used for paying bills and living expenses of retired seniors. This is very attractive to seniors as the process of getting one is quite easy compared to other options. However, nowadays, banks are stricter in granting refinancing to seniors. So the best thing you can do is to ask recommendation or a more affordable loan modification program from the lending company where you’re a current mortgage holder.
Seniors aging 62 and above are allowed to borrow money provided that they will use their home as collateral. The payback is reversed in such a way that the borrower can pay the loan when he or she dies, sell the home or moved out. The money received from a reverse mortgage can be used for living expenses, medical bills and improving your home.
The good thing about a reverse mortgage is that the title of the house is retained in your name. However, you have to ensure that the property is in good condition, and you’re paying homeowner’s insurance and property taxes. The borrower of a reverse mortgage is required to pay the principal amount, which includes the interest and other fees. There are different options for this type of mortgage such as HECM Standard, HECM Saver and HECM Purchases.
Any retired senior who is planning to get reverse mortgage must satisfy the broker’s requirements in order to qualify. Required information includes the age and financial and property data.
Federal mortgage programs
Aside from applying for mortgage refinancing from banks and lending companies, retired seniors can also consider federal mortgage programs. This is perfect for those who are having difficulty in getting approval from traditional refinancing systems due to the devaluation of their homes. You can opt to Home Affordable Refinancing Program, FHA Short Refinance and Home Affordable Foreclosure Alternatives.
Doing research can help in determining the right option for your needs. Through the help of a professional mortgage broker, you can be on the right track.
If you think that you’ll still be paying your mortgage even after retirement, the best thing to do is to plan strategies that will help you to manage your mortgage while on a fixed income. You can seek help from Mortgage Broker Toronto to guide you all throughout the process.