CalSTRS Retired Educator - Winter 2007 eNewsletter

As an advantage to our members, CalSTRS offers a comprehensive home loan program. We are pleased to announce that our relationship with Countrywide Bank now includes reverse mortgages for CalSTRS members and their parents. Reverse mortgages are becoming financial solutions for many seniors. They allow homeowners to remain living in their homes while supplementing their retirement income.

A reverse mortgage allows homeowners 62 and above to access their home equity without having to sell their property or make monthly mortgage payments. The homeowner continues to be responsible for their property taxes, insurance and home repairs. Borrowers can choose to receive their reverse mortgage funds in monthly payments, a lump sum, as a line of credit the borrower may access as needed, or a combination of these options. Reverse mortgages do not require repayment for as long as the borrower lives in the home as their primary residence. Once the last borrower dies, sells the home or permanently moves out, the loan becomes due and must be paid in full. Reverse mortgages are non-recourse loans which means that neither the borrower nor their heirs will owe more than the appraised value of the home when the loan becomes due.

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