Posted on: 08th Jan, 2009 09:54 am
Hello I need to know the difference between Difference between Open-End Mortgage and Closed End Mortgage and the What is Reverse Mortgage, Could you please explain these in brief
Hi n_raghu,
A mortgage in which the mortgagor is allowed to re-borrow against principal that has been paid so far is known as open-end mortgage. A mortgage for which repayment cannot be made prior to maturity is known as closed mortgage. In this case, re-pledging of the same collateral requires the bondholder's/lenders permission.
Reverse mortgage, on the other hand, is a home loan which provides you with steady flow of tax-free income, either in a lump sum or installments. As it provides easy flow of cash, so lot of seniors prefer this. Recently, a new law has come up which allows the seniors to buy their primary residence with a reverse mortgage. To know more about reverse mortgage, check out the given link:
http://www.mortgagefit.com/reverse.html
Thanks,
Jerry
A mortgage in which the mortgagor is allowed to re-borrow against principal that has been paid so far is known as open-end mortgage. A mortgage for which repayment cannot be made prior to maturity is known as closed mortgage. In this case, re-pledging of the same collateral requires the bondholder's/lenders permission.
Reverse mortgage, on the other hand, is a home loan which provides you with steady flow of tax-free income, either in a lump sum or installments. As it provides easy flow of cash, so lot of seniors prefer this. Recently, a new law has come up which allows the seniors to buy their primary residence with a reverse mortgage. To know more about reverse mortgage, check out the given link:
http://www.mortgagefit.com/reverse.html
Thanks,
Jerry