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Insight Bank to Offer Homeowners Flexibility With Reverse Mortgages
By Editor | September 6, 2007
Homeowners in their golden years will soon have relief from rising expenses, and it’s coming from a familiar source: their homes.
Insight Bank announced this week it will offer reverse mortgages, which allow homeowners age 62 and up to convert part of their home equity into tax-free income. Payouts can come as a lump sum, a monthly income, a line of credit, or a combination of all three.
“Rising energy costs, rising healthcare costs, and rising taxes are making it difficult for Ohioans to enjoy their later years,” says Insight CEO Mark Kelly. “Reverse mortgages provide a little much-needed financial flexibility.”
The homeowner will never have to make a payment as long as they occupy the home, which is why many borrowers are using reverse mortgages, even for purchasing a home.
The new product can also help eligible homeowners generate cash for home improvements, travel and other out-of-pocket expenses.
“Social security and pensions just don’t go far enough any more,” explains Kelly. “This is a chance for Insight Bank to help many homeowners supplement their income.”
Ohio ranks 16th in the nation, with over 6,600 reverse mortgages issued as of May. More than 300,000 seniors have tapped reverse mortgages nationwide, according to a report from the U.S. Department of Housing and Urban Development.
In contrast to traditional “forward mortgages,” lenders make payments to borrowers during the term of the loan.
“Reverse mortgages are a modern day fountain of youth,” says Kelly. “Homeowners are using the funds to actually enjoy their retirements.”
Baby boomers are also among the key players in the reverse mortgage market as they seek new ways to finance quality end-of-life care for elderly parents.
In a tough housing market, tapping a home’s equity with a reverse mortgage offers an alternative to putting up a for-sale sign and hoping for the best.
Borrowers who still owe money on a first mortgage are eligible for the program in most cases, depending on their home’s current value and the outstanding balance on their original loan.
Before being approved for a reverse mortgage, homeowners must first meet with an independent counselor from a government-approved housing counseling agency. The counselor will explain the pros, cons and implications of a reverse mortgage.
For more information, please visit http://www.insightbank.com.
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