Support yourself in old age by a reverse mortgage loan...
Any senior citizen of age 60 and above and owning a residential house or flat, can approach a Bank and earn a monthly income by going in for reverse mortgage of the house or flat.
Such a monthly income which will be paid as long as the elderly mortgagee lives, will come in handy to meet the living costs, healthcare costs etc. The house would continue to be used as residence till the lifetime of the house owner and his/her spouse.
Bank pays the reverse mortgage loan to the mortgagee partly in lump-sum and the balance in the form of annuity, which is a fixed amount paid monthly. After the mortgagee and spouse pass away, the heir can sell the property and repay the loan to the Bank or alternately, the Bank sells the property and after deducting the loan amount pays the balance amount to the heir.
How does reverse mortgage work?
First of all, contact one of the Banks listed in Resources below who then visit your house or flat to find out the market value of the property. The Bank may sanction upto 80% of the value of the apartment as a reverse mortgage loan.
Out of this loan amount, the senior citizen mortgagee can receive upfront lump-sum amount of 50% of loan amount or Rs 15 Lacs whichever is lower. Balance amount of reverse mortgage loan will be invested by the Bank in annuity schemes. Annuity amount per month will be depend on the number of years for which the monthly income is required.
Reverse mortgage facility is offered by leading Banks in India and soon insurance companies are also likely to enter the fray. The best part is that Government of India has made the annuity income tax-free.