Monday, May 23, 2011

Reverse Mortgage Scheme, bliss for senior citizens

For the people that have entered second innings of their life and does not have any primary source of income and yet they do not want to be a burden on anybody; reverse mortgage scheme is the best way out, the only condition that implies is that they must have a place of residence.

Reverse mortgage scheme is meant for the people that are above 60 years hand have a primary place of residence. The best thing about such loans is that considering the age of the applicants the loans procedure is very lenient and the loans are kept at high priority due to which the loan gets sanctioned in no time.

Under reverse mortgage scheme, lender pays the borrower a definite amount after a definite interval so that a borrower can meet his necessary requirements. It depends on the borrower whether he requires lump sum of money or if he wants to be paid on the monthly basis. The best part here is that the borrower can enjoy the benefits of the loan scheme while he is staying his house.

The idea here is that the lender decides the value of the property according to the market rates at time of borrowing and a borrower can opt from various options available to him to customize his loan. The loan amount will be due only if the borrower dies or he moves out of the property.

In that condition the lender will sell the property and will recover the loan amount due and in case the property fetches more amount then what the lenders is entitled to then the rest of the amount is transferred to the heirs of the applicant.

This scheme is not suitable for the people that do not want to give away their property as the lender will ultimately sell the property to recover the loan amount. The other thing that needs to be considered is that if a borrower moves out of the property immediately the amount that the lender has paid becomes due.

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