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Austin Reverse Mortgage

According to Wikipedia, Austin is the capital of the U.S. state of Texas and the seat of Travis County. Located in Central Texas on the eastern edge of the American Southwest, it is the 4th-largest city in Texas and the 15th-largest in the United States. According to the 2009 U.S. Census estimate, Austin had a population of 757,688. The city is the cultural and economic center of the Austin–Round Rock Metropolitan Area, with a population of 1,652,602 as of the July 2008 U.S. Census estimate—making it the 36th-largest- and 2nd-fastest-growing metropolitan area in the nation.

The area was settled in the 1830s on the banks of the Colorado River by pioneers who named the village Waterloo. The city was renamed after Stephen F. Austin, known as the father of Texas. The city grew throughout the 19th century and became a center for government and education with the construction of the Texas State Capitol and the University of Texas. After a lull in growth from the Great Depression, Austin resumed its development into a major city and emerged as a center for technology and business. Today, Austin is home to many companies, high-tech and otherwise, including the headquarters of three Fortune 500 corporations, Dell, Whole Foods Market, and Freescale Semiconductor.

Reverse Mortgage Limits in Austin

Now is the best time for seniors in Austin to think about obtaining a reverse mortgage. With the American Recovery and Reinvestment Act of 2009 that President Obama signed on February 17, seniors can now obtain a government-insured reversed mortgage up to $625,500. This replaces the previous cap of $417,000 that existed prior to the passage of this law but the higher limit is only good until the end of 2009. That means any senior who is considering obtaining a new reverse mortgage or adding funds to an existing one because of the new limits will have to do so very soon.

It’s important to keep in mind the new law does not change any of the qualifying factors for Austin seniors. You still must be at least 62 years old and the home connected to the reverse mortgage must be your primary residence. Even if you have a vacation home in which you spend more than half of your time it will not qualify for reverse mortgage funds though you may choose to use the funds from a reverse mortgage to purchase or rent a vacation home. Also keep in mind the amount of money for which you qualify will be based on your age, the value of the property and the interest rate. Just because the limit is $625,500 doesn’t mean you will be able to obtain that amount of cash from your home.

Even though the limits on reverse mortgages are national ones it makes no difference where you live. The only difference is that your home in Austin may be worth more than the same home in another place. So, you will still be able to obtain the 40 to 75 percent of your home’s value that lenders allow whether you live in Austin or a higher priced area. There are key qualifying factors that are already put into place by the government and they are not related to where the borrower lives.

There is reason to believe when the year is over the limits will return to $417,000. What that means for current Austin seniors is they need to quickly decide whether they want to take advantage of a new reverse mortgage at the high rate. Certainly if your home is not going to quality for the higher limits it is of little importance but for those who may indeed qualify for the maximum limit—or any amount over $417,000—you want to talk to a professional in the field of reverse mortgages in order to ascertain if this is the best route for you to take to generate more cash flow. The sooner you begin the process the better your chances are of beating the year end deadline.

You want to remember that a reverse mortgage is not like a traditional mortgage—you do not have to pay the money back as long as you continue to live in your home. The loan does not come due until you die, sell your home or move out of the home completely whether it is to go to a medical facility or with a relative caretaker.

Austin Links:
Austin City, Austin Seniors