Senior Reverse Mortgage

Seniors interested in getting a reverse mortgage will be pleased to hear that reverse mortgage rates are at an all-time low. Over the past few years, both adjustable and fixed rates have been on the decline. For seniors, this means higher reverse mortgage payouts and lower interest charges.

How Much Longer Will Low Reverse Mortgage Rates Last?

As the United States economy begins to improve, many consumers are wondering whether interest rates will also begin to rise. Since mortgage rates generally increase in times of prosperity and fall during economic downturns, this is a valid concern. Yet, while recent data released by the Federal Reserve proves that the U.S. economy is improving, mortgage rates have remained low.

Experts believe that the debt crisis in Europe will keep interest rates low in the immediate future. Also, since adjustable-rate reverse mortgages are typically based on the LIBOR index, which is an international index, Europe’s economic problems should keep adjustable rates from rising. Of course, this is not to say that rates will never increase, but seniors who want to take advantage of low rates still have the opportunity to do so.

Fixed Vs. Variable Rates: Which Is the Better Choice?

When choosing between fixed and variable reverse mortgage rates, it is important to consider more than just the rate. Fixed rate reverse mortgages require that borrowers accept their loan proceeds in one lump sum. While the rate will never increase, borrowers will be charged interest on the entire sum from the time they accept their loan.

With an adjustable rate reverse mortgage, borrowers also have the option of receiving their proceeds in monthly payments or as a line of credit. However, unlike with a fixed rate, borrowers are taking the chance that their rate will increase. Each type of interest rate offers borrowers both benefits and disadvantages that must be carefully considered.

For more information on reverse mortgage rates, contact us at 877-267-0274. One of our loan specialists will be happy to discuss your individual situation and determine the best reverse mortgage option for you.