Fannie Mae offers reverse mortgages
Millions of older Americans may be eligible to turn the value of their homes into cash without having to move out under a new program by the nation's largest source of home mortgage funds.
The Federal National Mortgage Association, known as Fannie Mae, said last week that it would begin offering "reverse mortgages," which enable senior citizen homeowners to convert the equity in the homes into income.
The reverse mortgage is an adjustable-rate loan that allows seniors to borrow against the value of their home.
The funds would be available for most personal financial needs, such as health care, home repair or a monthly income supplement.
Fannie Mae said seniors 62 and older who either own their homes or have very low mortgage debt remaining will be eligible.
The mortgages will be available by the beginning of 1996 through Fannie Mae's lenders.
Call (800) 732-6643 between 9 a.m. and 5 p.m. Monday through " Friday.
Home values in U.S. rose during quarter
Home values increased nationally during the third quarter of this year, growing at an annualized rate of 5.8 percent, according to the two major mortgage-funding agencies, Fannie Mae and Freddie Mac.
The agencies' Conventional Mortgage Home-Price Index also showed that housing prices grew at an annualized 6.9 percent rate in the New England and South Atlantic states during the quarter. Maryland is in the index's South Atlantic grouping.
Over the past five years, the South Atlantic states have seen home values grow 15 percent, according to the index. On the West Coast, the index says values have dropped 0.5 percent since 1990.