Many older adults who own homes may be unfamiliar with the term “reverse mortgage,” and how the loan works if they decide to apply for one. At the Senior Management Group in Bellmore, those who may be interested in a reverse mortgage can work one-on-one with the staff, and figure out what is the best option for them.
“The big misconception with the reverse mortgage is that you give your house to the bank,” said Steve Eplan, the owner of the Senior Management Group. “That’s not true — it’s a financial tool for a senior citizen.”
Eplan explained in instances where seniors or older adults may be living on a social security fixed income, paying taxes, home insurance and a mortgage can be a burden. Many are forced to leave their homes, and move out of state.
With a reverse mortgage, homeowners can “age in place.” The way it works is simple: depending on one’s age, the value of one’s home, and outstanding liens one has on their property, the lender gives a homeowner money through installments, a lump sum, a line of credit, or a combination of a line of credit and monthly installments.
The different from a regular mortgage is that no monthly payments are due from the reverse mortgage loan. Interest does accumulate on the loan, but payment is deferred until the homeowner dies, sells or moves out of the home.
“You can use that money for whatever reason — to live and get by,” Eplan said. “People don’t want to move. It can really take years off your life.”
Homeowners are still required to pay taxes and insurance.
“You always keep the title to your house as long you pay taxes and insurance,” Eplan added. “You miss one or two mortgage payments, [the bank] puts your into foreclosure. With [reverse mortgages], they don’t ask for payments so you can’t lose your house.”
Eplan noted that downgrading to a smaller home is not easy, and the cost of moving is expensive. Reverse mortgages allow homeowners to “live stress free” and “enjoy retirement.”
As a local reverse mortgage company, Senior Management Group is easily accessible, and they offer free in-home consultations with homeowners and their family members. Personal information will always be protected, and they will ensure that everyone involved fully understands the process, Eplan added.
Some testimonials from their website, myseniormanagement.com, offer reviews on the value of reverse mortgages. One customer wrote “I helped put my granddaughter through college and invested the balance to increase my monthly income.” Another said, “I paid off my debts so I don’t have to worry about making those monthly payments.”
Owned by Eplan, the company’s loan officer is Marc Seidman, who handles the Long Island territory. For more information on reverse mortgages, visit the company’s site, or call (516) 900-1500.