Can I sell my home if I have a reverse mortgage? The short answer is yes, however, selling a home with a reverse mortgage can be more challenging that selling one with a traditional mortgage. Reverse mortgages are meant to be a helpful financial tool for senior homeowners who need to supplement their income. Homeowners have the ability to sell when they want to. If you have a reverse mortgage it is important to consider your options before rushing into any decisions.
What is the loan balance of the reverse mortgage? Sellers that have a reverse mortgage owe the balance of the loan or 95% of the appraised value, whichever is lowest. If the loan balance, interest and fees are higher than the sales price the seller will owe money at closing. Sellers should also have a good read on their local market and understand what homes are selling for.
Timing is incredibly important in any real estate transaction. The age of the reverse mortgage is another factor for sellers who have a reverse mortgage to think about. If the reverse mortgage is only a few years old, selling may not be a viable option. There are considerable fees associate with reverse mortgages. Before selling, make sure to run the numbers to ensure there is enough equity in the home.
After the transaction is closed and funded, the proceeds of the sale will be used to pay the sellers mortgage balance, any liens, and closing costs. The remainder of the proceeds will go to the seller. Sellers normally use this money to transition into the next chapter of their life. Many sellers transition into assisted living facilities, back home with family, or downsize into a more managable space.
Would you want to know more about selling your home with a reverse mortgage? Enjoy professional services from our qualified team of licensed realtors and a fair and competitive cash offer for your house. Call or text 888-850-2636 today to speak with a knowledgeable advisor of the Homeinc Team.