A reverse mortgage is a special type of loan developed specifically for persons 62 years of age and older to convert the equity in their homes into cash. They are very popular; thousands of people have already used them to enhance their retirement lifestyle.

The reverse mortgage is aptly named because the payment stream is reversed. Instead of making monthly payments to a lender, as with a regular first mortgage or home equity loan, a lender makes payments to you. You do not have to pay back the reverse mortgage loan for as long as you live in your home. While a reverse mortgage loan is outstanding, you continue to own the home and hold title to it.

• Daily living expenses
• Home repairs and modifications
• Medical bills and prescription drugs
• Pay off debt
• Travel

To qualify for a reverse mortgage you must be at least 62 and own your home. The home must be your primary residence. There are no income or medical requirements to qualify. You may be eligible for a reverse mortgage even if you still owe money on a first or second mortgage. In fact, many seniors get a reverse mortgage to pay off a first mortgage.

The size of the reverse mortgage that you can get depends on your age at the time you apply for the loan, the type of reverse mortgage you choose, the value of your home, and current interest rates. In general, the older you are and the more valuable your home (and the less you owe on your home), the larger the reverse mortgage can be.

Texas home owners can choose to receive the money from a reverse mortgage all at once as a lump sum or in fixed monthly payments. Texas borrowers can now get a Line of Credit.

A reverse mortgage is extremely safe. The reverse mortgage is insured by the Federal Housing Authority (FHA) and so is guaranteed by the federal government . You continue to own your home, but simply reduce the amount of equity in exchange for additional liquid or accessible cash. You are still responsible for property taxes, insurance and repairs. The money plus interest is paid back when you sell your home, permanently move out of your home, or when you die (or the last surviving borrower dies). In the event of your death, your property goes to your estate and your heirs will decide to either refinance the property or put it up for sale. If your heirs decide to sell your home, the mortgage will be paid off and the remainder of the money will go to them. Your heirs are never responsible for a reverse mortgage debt. If your home does not sell for enough to cover the reverse mortgage loan, the FHA will pay the difference.

To apply or learn more about Southside Bank's Reverse Mortgage Loans, please call:  Kim Page at 903-535-4412 or email at kim.page@southside.com.

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