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Reverse Mortgages: Providing Financial Freedom for Seniors
By John Howard, 1st Metropolitan Mortgage

Many senior citizens do not have a fixed income and therefore, may face some financial burdens. At 1st Metropolitan Mortgage, their reverse mortgage program can help seniors live their retirement years worry free.

A reverse mortgage is a FHA insured program that allows senior homeowners that are 62 years of age or older to transform some of the equity in their homes into a tax-free income without having to sell the home, give up the title or make monthly mortgage payments. Instead of making monthly payments to a lender, as with a regular mortgage, a lender makes payments to the client in one lump sum, in monthly payments or in credit line requests.

The team at 1st Metropolitan Mortgage is dedicated to helping seniors. “We meet with our clients in their home and treat them just as we would want our parents or grandparents to be treated,” said John Howard, Branch Manager and Reverse Mortgage Specialist. The reverse mortgage division is located in La Plata, Maryland.

A reverse mortgage can benefit seniors who are burdened by the cost of living, taxes, prescriptions and do not have an income or who simply want to enhance their lives as well as their families’ by using money received from their reverse mortgage to purchase, for example, a vacation home. There are no income or medical requirements that seniors must have in order to qualify.

1st Metropolitan Mortgage offers a couple different ways seniors can choose to receive the money from a reverse mortgage. The money can be paid all at once, by fixed monthly payments, a line of credit or through a combination of these.

A reverse mortgage has multiple benefits for seniors: there are no payments on the mortgage for as long as the borrower lives in the home; the proceeds can be used for any reason; ownership to the home remains in the borrower’s name, not the lenders; proceeds from a reverse mortgage are not taxable and after the estate repays the lender, the remaining equity is paid to the borrower’s heirs.

The amount of money that the borrower can receive depends upon a couple of factors: the interest rate at the time of closing; age of the youngest borrower, (the older the borrower’s age, the greater the proceeds available); and the appraised value of the home, (the higher the appraised value, the greater the proceeds to the borrower).

1st Metropolitan Mortgage has helped many seniors who do not realize that if they are 62 years or older and a homeowner, that they can tap into the equity in their home, turn it into cash and never make a payment as long as they live in their home. “There have been hundreds in our community that we have been able to help. One couple in particular did not have a mortgage, but also did not have any extra money to live on each month. They thought the retirement years would be a time when they could relax and enjoy life. However, with the cost of living, taxes, prescriptions, etc., they were barely making ends meet. We did a reverse mortgage and they now have an extra $600 a month to live on. They will receive that check every month for as long as they live in their home and will not have to make monthly payments on their mortgage,” Mr. Howard said.

1st Metropolitan Mortgage is different from other mortgage companies because of their expertise in the area of reverse mortgages. “We are confident we can offer seniors professional, caring and dedicated service to help them stay in their home as long as they wish and help make their golden years more golden,” said Mr. Howard.

John Howard