Texas Reverse Mortgage Calculator For Home Equity Conversion Loans

Although the commercials on television recount the advantages of a reverse mortgage for senior citizens, they fail to let you know the possible downfalls.  As with anything in life, if there are pros to a solution, cons are not far behind. While the advertisements make it sound so good that any senior citizen would be crazy not to use it as a major retirement planning tool, you need to check all of your options, both good and bad, and crunch the numbers with a Texas reverse mortgage calculator, before making the final decision.

Probably the first question any senior asks, when exploring the potential of a reverse mortgage is whether he/ she is qualified. In short, the youngest senior in the home of primary residence must be at least 62 years old or older. The home must be owned by the borrower outright, or with very little of the traditional mortgage outstanding. In addition, the house must be in good condition and well maintained.

If any aspect of the last paragraph does not apply to you, then you will not qualify for a reverse mortgage for senior homeowners.  However, for those of you who are still in the running for a reverse mortgage, you will want to discover if the monies you receive will be worth applying for the mortgage.

HUD, the Department of Housing and Urban Development actually has a calculator to determine your eligibility and what the monthly payments to you will be, after you sign on the dotted line. For example, if you are 70 years of age and you live in a $200,000 home, that is paid in full, with a HECM (Home Equity Conversion Mortgage) loan, you would receive $123,860 as one lump sum.

However, if you choose, you could have a credit line of the same amount that would grow, with interest, at a rate 5.30%. So, if you do not spend it, it will actually be making you money.  In addition, you may opt to have a monthly loan advance of approximately $743 per month.  Finally, if you so choose, you can select to have a combination of options.

For example, you have always dreamed of going on a cruise after retirement.  Of course, you will need some money for a vacation of that nature.  So, you ask to have a lump sum payment, so you can afford to go sailing, and then the remainder put into a line of credit or a monthly check.  It is your money; you choose what you want to do with it.

Many aspects of a reverse mortgage loan must be explored before you liquidate the asset of your home.  Nevertheless, it all comes down to the money.  So, before you take the time and effort, going through the process, and then deciding that it is not worth it, you can gather the information and crunch the numbers with a Texas reverse mortgage calculator, helping you make the right decision.