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Understanding Hawaii Mortgage Basics and Reverse Mortgages

Mortgage Basics

If you have a mortgage, you are securing a guarantee that the total amount borrowed from the lender will be repaid together with the interest and all charges incurred at the given time frame. For most consumers, applying for a mortgage is one of the most serious financial decisions they could ever make in their entire life.


There are very many lending institutions today that offer mortgage loans, with banks being the number one mortgage lenders. Special mortgage lenders and building societies are also known to offer mortgage services to home owners. You can also opt to use a mortgage broker to help you in securing a mortgage. The broker will help you find important information regarding mortgages and act as your financial advisor who will advice you on the best mortgages as per your financial situation.


Generally, there are two principal ways in which you can pay your mortgage. One is the full repayment plan where you get into a legally binding agreement that you will pay back the loan and incurred interest over a given period of time. For example, you could negotiate for a 30-year repayment plan which will have a fixed rate of interest. The other way of paying for mortgages is known as the interest-only mortgage which, as the name would suggest allows home owners to pay only the interest of the loan for a given fixed period of time. However, you are expected to build savings over time or put all your cash in an investment plan so that you can be able to repay the entire loan once the mortgage becomes due.


Reverse Mortgages

Today, the in-thing is reverse mortgages perhaps due to its attractive perks. Unlike normal mortgage loans, you will not be expected to pay a penny with the reverse mortgage, rather, you will get a monthly payment or opt for a lump sum amount from your lender. This cash comes from the home equity that you have accumulated over the years. Perhaps the biggest attraction to reverse mortgages is the fact that it isn’t taxable and does not affect one’s social security benefits or Medicare. More importantly, you get to retain ownership of your home for as long as you will be residing in it. 

A reverse mortgage becomes due when the last borrower passes on. In case no one lives in the property anymore or it has been sold to a third party, the loan will then be up for repayment. To qualify for a reverse mortgage, one has to be at least 62 years of age. Up to three people aged 62 and above can apply and qualify for a reverse mortgage as long as they meet all other requirements. Simply put, if you are a senior citizen, a reverse mortgage can be a reliable source of income in your sunset years.



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Basic Mortgage Modification Rules

Essential Tips for Securing the Best Mortgage Refinancing Rates

How the Credit Score Affects Getting a Mortgage

How to Stay In Your Home without Servicing your Mortgage

Importance of a Specialist Large Mortgage Broker

When does Home Mortgage Refinancing become the Best Option?

Traits of a Good Mortgage Lender