Have you heard about the concept of the reverse mortgage? What is reverse mortgage and how can it help you avail a huge amount of money without hassles? If you wanted to know about it, then we are here with a quick post to help you out.
What is Reverse Mortgage?
A reverse mortgage is a home loan in which the borrower receives the loan amount in some installments for a home that he/she owns. It is also referred to as the opposite of the home loan where the borrower would need to pay EMI to the lender.
Reverse Mortgage Eligibility Conditions at a Glance
Here are some easy reverse mortgage criteria that you should have a look at if you wish to go for it in the future:
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The reverse mortgage facility is available to anyone in India, who has attained the age of at least 60 years. If you are a couple who wish to apply for it jointly, the age of one of the members should be at least 60 years. Some lenders may also want the other member to be at least 55 years. On the other hand, some may have the age of the other member fixed at 58 years.
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The borrower under the reverse mortgage facility needs to have a fully owned home. In case of a couple, at least one of them needs to have a home. Some lenders take over the home loan and pay off the balance in easy EMIs to the borrower.
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The age of the property should be at least 20 years on the date of applying for the loan.
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The home should be the permanent address/residence of the individual.
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The property must not have been received as a gift and should be self-acquired/made.
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Rented properties or some being used for full or partial commercial purposes are not eligible for it.
Reverse Mortgage Documents
Although it may differ from lenders to lenders, some of the standard documents required for the reverse mortgage scheme are:
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PAN Card
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Aadhaar Card
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List of legal heirs
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Property details
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Registered will
What are the Benefits of Opting for the Reverse Mortgage?
The reverse mortgage scheme offers many benefits to the borrower. However, some of the relevant advantages of it are:
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The money that one receives in EMIs from the bank or another lender won’t eat up tax and hamper your income. Yes, the income is tax free.
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Do you want the home that you wish to put under the reverse mortgage scheme undergoes any renewal or repairs with the received money? The spent amount will be eligible for deduction in the income’s calculation.
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The reverse mortgage loan repayment will not be considered deductible at the end of the loan tenor.
The only two things that go against this facility are that:
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It involves a lengthy documentation process which may not be a cup of tea for retired or senior citizens anymore
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The paid monthly that is paid by a lender is fixed. As a result, there are absolutely no chances of getting it enhanced after some time. Needless to say that your income won’t go up even though the expenses would.
You are aware of some of the basics of the reverse mortgage scheme. You can apply and get regular monthly income to assist you during the retirement. Based on your needs, you can take a call if it’s relevant to you or not. You can check out your pre-approved loan offers by sharing your name and mobile number.
Additional Read: Reverse Mortgage: Direct Benefit for Senior Citizens on LAP
Bajaj Finserv offers pre-approved offers on home loans, loan against property, personal loans, business loans, EMI finance and beyond. It can help you ease off the tiresome loan application and processing and would make it hassle-free.
