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 Questions & Answers on Reverse Mortgages
Frequently asked questions on Seniors Finance Australia Reverse Mortgage / Home Equity Release Loans
- if you have any other queries after reading the following then please call us on - 1300 881 807
What is a reverse mortgage /home equity release loan ?
It is a special type of loan that allows you to use the equity or assets value that you have built up in your home and to be able to turn this equity into cash to use for whatever reason you want – i.e. holiday, living expenses, new car, renovations, help your family, health costs
Who can qualify ?
If you own your own home , holiday home or investment property and you are over 65 years of age then you would qualifier for a reverse mortgage - seniors home euqity loan.
What happens to the Title of my home ?
The Title of you home will stay in your name.
Do I have to make any repayment on the loan ?
No, you do not have to make any repayments on the life of this - reverse mortgage loan.
Can I make voluntary payments ?
Yes, you can make voluntary repayment if you wish to do this on the reverse mortgage loan.
When does this reverse mortgage loan have to be repaid ?
It is a “lifetime loan”. The loan will be repaid when you choose to sell your home yourself, or when the last surviving borrower passes away.
How much can I borrow ?
The amount you can borrow for the Reverse Mortgage loan depends on the age of the youngest borrow against the valuation of your property . The loan amount is a percentage on the value of the property and starts at age 65. The value of the property generally increases over this period of time as well. Please call us on 1300 881807 and we can give your loan amount.
What if I have a mortgage on the property at the moment –
If the amount you presently owe on a mortgage is less than what you can borrow then this present mortgage would be paid out for you as part of the reverse mortgage - seniors finance loan.
How can I default on a reverse mortgage ?
As this is a “lifetime loan with no repayments” you may think how can I default ?
It is part of the loan agreement that you keep insurance on the home and if you did not do this then it would mean the loan could go into default.
Will a reverse mortgage effect my pension ?
This will depend on your circumstances and what you require the money for or when you intend to use the money. In general terms, if you are on full pension and have little or no other income or assets and are requiring the money to say buy a car, do some renovation, go for a holiday, spend the money for personal reasons then it does not generally affect your pension but we do ask that you seek advice from the Centrelink on your personal situation when going into a reverse mortgage.
Why do I need a lawyer ?
It is a requirement that after the loan is approved and you receive your reverse mortgage/equity release documents that you take these to your lawyer for independent legal advice so that they can explain to you what the documents are about, answer any legal questions on these documents that you may have so that you are comfortable and understand this mortgage agreement as this Reveerse Mortgage is a lifetime loan.
Rates - Variable rate apply onthe Reverse Mortgage - please ask for the current rate by calling 1300 881 807
Can I pay the Reverse Mortgage loan back ?
You can make voluntary partial or full repayment of the reverse mortgage seniors finance loan whenever you wish. Details for repayments are in the Legal documents.
What does a No Negative Equity Pledge mean ?
The No negative Equity Pledge ensures that you (or your estate) will not have to pay any shortfall difference between the sale price of your home and the outstanding balance owed when the home is sold. (see your contract)
If you kept borrowing as you aged and lived for a very long time and for some reason the loan was greater than the sale price of the property it means that you, or your estate never have to pay back more than the sale price of the property.
Can I have a "Flexible re-draw" put in place ? Yes, you can have this option - this is where you can choose to take your maximum amount as your limit, and then draw down the amount that you require, when you require it. Interest is only charged on the amount that you actually use. Please ask how this will work for you.
I have my home on a Rural acres property, do you lend on this ? Yes, you can have an equity release / reverse mortgage if this is your own home on acreage. This depends on postcode and can be looked at on a case by case basis.
The home that I live in is owned by my Family Trust / Company, can I have an equity release ? No, only in personal names.
As I get Older and I need more money, can I do this ? - The equity release / reverse mortgage loan is on age and property valuation. As your home increases in value , or as the youngest borrow get older you can increase the size of the loan.
Legal Advice - Once the loan is approved you will be issued with the legal Loan Agreement, Terms and Conditions. The Loan Agreement and legal documents must be taken to your laywer for advice and to be witnessed and the lawyer will also witmess your ID documents.
To Download an Application Assessment Form click here
If you have any further questions please email or call our office on
1300 881 807
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