Depending on the financial needs of a retired individual, a senior citizen in Oregon may opt for the Oregon reverse mortgage programs offered by the reverse mortgage lenders operating in the area. One needs to very carefully ascertain whether financial assistance is at all required. The reason being although, reverse mortgage schemes are very helpful, the money has to be returned even though it is after a long span of time.
Unlike the traditional mortgage programs, reverse mortgage programs have the interest compounded on the main amount. Consequently, there is lessening of home equity and increase in debt amount.
Moreover, the costs associated with Oregon reverse mortgage are also expensive as compared to the traditional mortgage loan. However, the loan amount availed may be treated as a loan cum financial assistance. It is not considered as income. Since it does not fall in the category of income, the money is not taxable.
Satisfying eligibility criteria:
The Oregon reverse mortgage lenders extend the reverse mortgage loan on fulfilling the following parameters.
The borrower has to be 62 years or more.
Must be essentially retired from services
Must be the owner of a house, which may be kept as collateral against the reverse mortgage loan amount.
Usage of the proceeds:
The proceeds of Oregon reverse mortgage may be utilized in the following manner.
For clearing existing debt in separate loan programs
For the infrastructure enhancement of ones residential property
For paying taxes, fees and other charges related to the property(dwelling place).
For going on a vacation
For buying a car/vehicle
Repaying Oregon reverse mortgage loan:
One does not have to return the loan amount every month as in the case of forward mortgage loans. The money may be returned after the death of the principal applicant. Thereafter, the co applicant may return the amount by selling off the house or repaying the loan amount leading to the closure of the loan. But one disadvantage of this type of loan is that the repayment amount compounds every years and finally the amount, which is required to be paid far exceeds the actual amount coupled with interest amount. The closing costs of reverse mortgage loan programs are costlier than the traditional ones.