GMAC Real Estate Reverse Mortgages and Second Homes
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Reverse Mortgages and Second Homes

Takeaways

  • Reverse mortgages were created in 1989 and are targeted to homeowners over 62.
  • Originally these loans were often cash of last resort for seniors. Now they are being used for capital to make purchases such as second homes.

Did you know?

  • You, or your estate, will never owe more than the value of the property to pay back a reverse mortgage.
Pull money out of your home. A reverse mortgage is one way to pull money out of your primary residence if you are looking for funds to buy a second home. The reverse mortgage was created in 1989 and is targeted to homeowners over 62 and would like to get cash from their real estate. The reverse loan is simply a home equity loan without a payment. If you use a straight home equity loan to get cash from your primary residence you will immediately start making payments on that loan, and if you can’t meet the obligation your house could face foreclosure.

The reverse loan provides you money without immediate payments. The amount you receive in a reverse mortgage is based on the value of your primary residence, the interest rate and the number and ages of the homeowners. As long as you live in the house a reverse loan will not force you to sell or vacate the property and you, or your heirs, will never owe more than value of the home to repay the loan. Mortgage insurance covers any difference between the value of the home and the actual amount of the loan.

If you are interested in a reverse mortgage, remember this financial tool requires you to clear all prior loans and liens on your home and before you can sign the papers you must meet with an independent reverse mortgage counselor.

Search for Second Homes for Sale

To search for a selection of second homes for sale, please visit the website of a GMAC Real Estate Office that serves the area where you'd like to buy a second home. To learn more about buying Second Homes or Vacation Homes, explore the rest of this section, or contact a GMAC Real Estate Agent.