Whats the difference between a reverse mortgage and a conventional mortgage?
With a traditional mortgage, or a home equity line of credit, you must have sufficient income versus debt ratio to qualify for the loan, and you are required to make monthly mortgage payments. The reverse mortgage is different in that it pays the borrower, and is available regardless of their current income. The amount that can be borrowed depends on the buyers age, the current interest rate, and the appraised value of the home or FHA’s mortgage limits for your area, whichever is less. Generally, the more valuable the home is, the older the buyer are, the lower the interest, the more can be borrowed. Your buyers don’t make payments, because the loan is not due as long as the house is their principal residence. What are the drawbacks to a Reverse Mortgage to buy a Manufactured Home? • Larger down payment or equity required than a typical loan. • No construction or stage funding available.
