Types Of Mortgage To Opt For

July 25, 2016  //  Posted by: Crowe  //  Category: Loans

Different types of mortgageMortgage is such an agreement where in you give the right to the mortgagor to take away your property if the mortgagee fails to repay the money in specified time. Mortgage is similar to that of home loan only. Here also you take the mortgage for buying a new home and you take the mortgage on the home you are buying or any other property of yours. In today’s time, there are too many types of mortgage which you can opt. You might not be having knowledge about each of them and hence you don’t have varied choices to pick from. But if you want mortgage and you are in search of finding the right type of mortgage then you must study each and every type of mortgage and then pick one which is best and suits your needs in all manner. Here are some of the types of mortgage which you can opt for.

  • Reverse mortgage

Reverse mortgage is such type of mortgage which provides people with income who are generally over the age of 62 years and has enough equities in their homes. Retired people sometimes use this reverse mortgage and it is by far the best type of mortgage for retirees. They opt for reverse mortgage to supplement their income and get a good sum of amount out of their homes which they paid a long time ago. Here you can swap out your mortgage if you get a better deal. When you refinance your mortgage, you will get a new mortgage which pays off your old mortgage. This can cost you with money but it can be paid off after some period of time if you get the numbers to line up appropriately.

  • Second mortgage

Second mortgage will enable you to have another mortgage on the same property. Your second lender will be having the position of second number. This indicates that the second lender would be paid only if there is any amount left after paying off the first mortgage lender. First priority will be given to first mortgage lender and he would get his total amount back and then if anything is left behind then it will be given to the second mortgage lender. Such type or mortgage is usually taken for higher education and home improvement projects. In the situations of financial crisis, such type of mortgage is usually used to cash out your home equity.

  • Mortgage by conditional sale

When mortgager sells the property which is mortgaged on the condition that

  • When there is a default of the payment of mortgaged money on a specific date, the sale will become absolute.
  • On the condition that when the payment will be made fully, the sale will become void
  • On the condition that when the full payment will be made, the buyer will transfer the property back to the seller.

Any transaction with such condition will be referred to as mortgage by conditional sale.