Reverse Mortgages and Title Insurance

You can only apply for a reverse mortgage if you are at least 62 and your name is on the title to your home. If you are married, you and your spouse must be on the title to apply for a reverse home mortgage together. As part of the process, a title search is done and you must buy title insurance.

Why Title Insurance Is Necessary

You may be wondering why you even need to take out a new title insurance policy if you’ve lived in the home for many years. Title insurance protects reverse mortgage lenders from any problems that may occur with the title to your property. Although most people probably won’t have any issue with their title, there could be instances where disputes come up if there are divorces and remarriages involved. Title insurance for owners protects you against any problems with the title.

Reverse Loan Scams

An up-to-date title insurance policy could also guard against reverse mortgage fraud. Some reverse loan scams involve people who attempt to strip seniors of their equity by transferring the title to their home. Avoid using reverse mortgage companies that don’t have a track record or try to pressure you to do things you are uncomfortable with.

If someone offers you a free home to live in as part of a reverse mortgage scheme, be aware that some type of fraud involving the title could be involved. Do not get involved with this type of deal.

Reverse Mortgage Closing Costs

Fees for title insurance are included with other closing costs. The amount varies depending upon how much you borrow. To get more information on reverse mortgage guidelines and the fees involved, shop around for quotes from several lenders. Before you apply for a loan you also are required to meet with a reverse mortgage counselor.

This entry was posted on Tuesday, March 30th, 2010 at 4:53 pm and is filed under Reverse Mortgage . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.