How to qualify for a reverse mortgage in the United States?
For someone to be able to apply for a reverse mortgage in the United States, he or she must at least be 62 years old and must occupy the property as the principal home. If there is still a regular mortgage on the house, it must be low enough so that it can be paid off with the benefits of the reverse mortgage. If all these demands are met, the person who wants to acquire the reverse mortgage has to follow a counselling course, before the borrowing process starts. In this course the borrower learns about the risks of the reverse mortgage, and how to handle tem in a responsible way.
Since March 2015 the lending party is obliged to do an intensive credit check for everyone applying for a reverse mortgage, to assure that the reverse mortgage will not create financial problems for the borrowers.
How to qualify for a reverse mortgage in Canada?
In Canada, one qualifies for a reverse mortgage at the age of 55 or above. If there is still a regular mortgage on the house, it should be possible to pay it off with the benefits of the reverse mortgage. No further qualifications are demanded.
How to qualify for a reverse mortgage in Australia?
In Australia, someone must usually be over the age of 60 or 65 to qualify for a reverse mortgage. Which age limit applies, depends on which lender grants the reverse mortgage. If there is more than one lender, the youngest lender must meet the age demand. If there is still a mortgage on the house, it should be low enough so it can be paid off with the benefits from the reverse mortgage.
The interest rates of reverse mortgages in the United States can be fixed or adjustable. When the interest rate is adjustable, it can be adjusted monthly or annually, with a maximum interest rate which is communicated to the borrower before the lending contract is signed. The average interest rate lies between 5.5 and 7%
In Canada the interest rates vary per program, with interest rates varying from 3.99 to 5.45%.
In Australia the interest rates for reverse mortgages also vary per program. Some programs have fixed rate loans, while other programs have variable rate loans.