Reverse Mortgages Can Be Used To Buy Vacation Homes

6/17/2007

posted by N. Sioris

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Reverse Mortgages can be used for any purpose. Some seniors with substantial equity in their primary residences are taking out Reverse Mortgages to buy vacation homes.

Since borrowers have several options to choose from when deciding how they would like to receive the money from a Reverse Mortgage, some are opting to receive all or part of the money as a lump sum distribution. With the lump sum payout, they are then able to purchase a vacation or second home for all cash. By doing this, they not only do not have any monthly mortgage payments to make on their primary residence, which they took out the Reverse Mortgage against, but they also do not have any monthly mortgage payments on the vacation home, since they paid all cash for it. The seniors can then leave the vacation home to their heirs as part of their overall estate when they pass away and the primary residence is used to payoff the Reverse Mortgage. If there is additional equity in the primary residence after the Reverse Mortgage is paid off then the estate also receives the excess equity from the primary residence, as part of the overall estate.

As Reverse Mortgages continue to gain in popularity, we will see more creative ways that they can enhance the lives and lifestyles of the senior population.

Request A Free Reverse Mortgage Evaluation and see how much money you can receive from a Reverse Mortgage.