Downtown Honolulu, Hawaii
1188 Bishop St. Ste. 2503
Honolulu, HI 96813
(808) 599-1400

What Is a Reverse Mortgage & What Are Its Benefits? June 22, 2018

Downtown Honolulu, Honolulu
What Is a Reverse Mortgage & What Are Its Benefits?, Honolulu, Hawaii

Retirees who need an extra source of income may find financial relief with a reverse mortgage. This loan is designed to use accumulated home equity to help pay for rent, medical costs, and other living expenses. As the area’s premier provider of reverse mortgages, Aloha Mortgage, LLC in Honolulu, HI, helps senior citizens maintain their lifestyles.

What Is a Reverse Mortgage?

How It Works

The loan’s is officially known as a home equity conversion. It is only available to homeowners who are 62 years or older and have built up equity in their houses over the years. They can withdraw the equity to supplement retirement savings. Typically, applicants have either paid off their entire mortgage or are close to doing so.

What makes a reverse mortgage different from a traditional mortgage is that the person is not responsible for making monthly payments. Instead, they are required to continue paying property taxes and homeowners insurance. If approved for the loan, the borrower is also obligated to use their primary residence for the duration of the reverse mortgage period. If the home is sold or the borrower dies, the total amount borrowed is due. 

reverse mortgageWhat Are the Benefits?

One of the main advantages of a reverse mortgage is its repayment flexibility. The borrower does not have to pay back the loan unless they move or sell the home. As long as the borrower or their spouse keeps the home as their primary residence, they aren’t obligated to make payments until one of them passes away. Another benefit is tax-free withdrawals. Borrowers don’t have to pay tax on the distributions because a reverse mortgage is considered a loan and not a source of income.

Finally, reverse mortgage approvals are not connected to the applicant’s income or credit history. As long as the borrower is 62 years or older and is a homeowner that has accrued equity they will be eligible for the loan.

If you’re retired and seeking additional funds to supplement your income, a reverse mortgage may be the solution. Let the experienced lending team at Aloha Mortgage, LLC help determine if their loan products are right for you. To get started, call (808) 255-9366 to arrange a friendly, no-obligation consultation. For your convenience, the agency serves the entire island of Oahu.

Other Announcements, Events and Deals from Aloha Mortgage, LLC.
3 Home Improvement Projects That Add Value, Honolulu, Hawaii
If you ever decide to sell your house, wooing interested buyers requires standing out from the competition. One effective way to stir more interest is through amazing home renovation...read more
3 Criteria Mortgage Brokers Consider, Honolulu, Hawaii
If you dream of owning a home, you can make it a reality if you prepare for the process well in advance. In addition to saving money for a down payment, look into what mort...read more
4 Benefits of Putting a 20% Down Payment on a Home, Honolulu, Hawaii
Buying a house, especially for the first time, can bring a mix of excitement and uncertainty. After all, the purchase will likely be the largest financial investment for most people....read more
3 Tips for Getting Your Home Loan Application Approved, Honolulu, Hawaii
For first-time home shoppers, securing a home loan can be an intimidating process. However, with a bit of preparation, your mortgage application can get the green light towards home ...read more
 3 Mistakes First-Time Buyers Make When Applying for a Home Loan , Honolulu, Hawaii
After years of apartment dwelling, you’re ready to start the path toward homeownership. For first-time buyers, the experience can be a mix of excitement and the unknown. Unfortunatel...read more