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Bargaining For The Best Reverse Mortgage Rates

By: Wade Robins, Tue Jun 12th, 2007

Reverse mortgage rates are not different form traditional mortgage rates, and when you are applying for a reverse mortgage you should make every effort to find the lowest reverse mortgage rates you possibly can. While comparison shopping takes time, you can help your own cause by taking advantage of the reverse mortgage calculators available on one of the many reversed mortgage Internet websites.

You will have to pay interest on your reverse mortgage loan regardless of whether you receive your money as a single lump sum, in monthly installments, or as advances on a credit line. In the US, reverse mortgage rates are tied to the US Treasury rate, and like all adjustable mortgages rates will fluctuate as it does.

The Margin Is The Difference

Because of this, any money you save on your reverse mortgage rates will be as a result of the competition among lenders. Their margin--the amount they charge in interest over and above the variable treasury-based reverse mortgage rate, will vary from company to company. Lenders can adjust their rates anywhere from once a month to once a year.

Fixed-Rate Reverse Mortgages

Fixed-rate reverse mortgages are the exception to the rule, although they have become more available in recent months. One limitation on a fixed-rate reverse mortgage is that the borrower must take his or her money in a single payment; monthly installments and lines of credit are not permitted. Fixed reverse mortgage rates, in early 2007, were hovering in the low end of the six percent range, not including the lenders' margins.

Your fixed mortgage rate will have nothing to do with your credit history or your income. Even low-income senior citizens who have paid for their homes are eligible for reverse mortgages; they, in fact, are the individuals for whom reverse mortgages are primarily intended.

You can get a better idea of reverse mortgage rates by researching both online and brick-and-mortar reverse mortgage brokers; many brokers have both websites and offices. Find the best online rate you can, then take it to the reverse mortgage lenders in your area and use it as a negotiating tool if necessary.

You can find a list of legitimate reverse mortgage lenders close to you by doing a search on the National Reverse Mortgage Lenders Association--NRMLA--website, searching by the name of the state in which you live, and then whittling down the results to lenders in your area. All NRMLA lenders are committed to upholding a Code of Conduct, which means they will deal with you fairly in the reverse mortgage process.

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You can also find more info on Reverse Mortgage Lender and Reverse Mortgage Loans. i-reversemortgages.com is a comprehensive resource to get information about Reverse Mortgage.