Reverse Mortgage Cash Accounts are Available for Texas Seniors

New legislation, approved by Texas voters in November 2005, provides several new options for senior citizens who need to convert home equity into cash.

San Antonio, Texas (PRWEB) April 27, 2006 -- Reverse Mortgage Specialist Craig Castle of San Antonio has become the first to assist a Texas senior citizen to obtain one of the new “jumbo” reverse mortgages.

The November 8, 2005 election created this opportunity for Texas seniors to convert the equity they have in their home into cash.

“The new ‘jumbo’ reverse mortgages allow senior homeowners with homes valued above $400,000 to access a greater portion of their home equity, and to choose to take the loan proceeds immediately or over time,” Castle explained.

Today only Financial Freedom Senior Funding Corporation, the nation’s largest reverse mortgage lender, offers Texans these “jumbo” reverse mortgage line of credit accounts (which they call “cash accounts”). But, in time, other companies are likely to do so, too.

The new cash accounts became available in March, and should offer many benefits for seniors with homes valued at more than $400,000. Financial Freedom’s proprietary cash accounts allow these homeowners to access greater portions of their equity than the government-insured programs previously available.

They also allow homeowners to choose how much of the loan amount they wish to receive at closing. Depending upon the plan chosen, they can set up the entire proceeds as a “line of credit” emergency fund for future use, take 75% upfront with 25% available as a line of credit, or take 100% at closing.

Like all reverse mortgages, the cash accounts are available to homeowners who are age 62 years or older. Neither income qualification nor a credit check is needed. The loan does not have to be repaid until the borrower is ready to leave his or her home permanently, then the home is sold to repay the loan. If the borrower opts to prepay the loan, there is no penalty, however. Because the loan is non-recourse, the borrower or his or her estate can never owe more than the value of the loan.

“The new Financial Freedom reverse mortgage cash account plans make reverse mortgages a viable option for a whole new group of Texas seniors who live in very valuable homes, but need additional income,” Castle said.

“One of the things that make reverse mortgages especially attractive is that the proceeds from reverse mortgages are not taxable and do not effect Social Security benefits,” he added. “Some candidates for the new cash accounts will have other assets that could be sold to provide cash, but those might incur greater tax liability.”

“Reverse mortgages are not right for everyone,” Castle said. “But the cash accounts will open up the opportunity to enjoy peace of mind for many Texas seniors with significant home equity whose income needs are not now being met.”

Craig Castle is a Reverse Mortgage Specialist with Financial Freedom in San Antonio and the South Texas area. He holds a BA in Economics from the University of Missouri, is a former Licensed Stock Broker, and has worked with reverse mortgages for the past four years. He is also chairman of the Not Forgotten Coalition, a not-for-profit organization that provides services and advocacy for senior citizens in San Antonio. For more information, visit http://www.SouthTexasReverseMortgage.com or phone 210-789-3685.

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