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Discussion in 'Countryside Families' started by majic99, Nov 19, 2006.
Any one have any thoughts or ideas on the subject?
majic99,I will be looking into reverse when I hit 62(this spring).All the signers must be at least 62 at time of mortgage.that much I know. The rest ,I'm still looking into.there are many mortgage companies that offer reverse,so check out more than 1.I'll start at my local bank.
Be very careful and give it a lot of thought and research before deciding. Where I live there have been adds on radio and tv telling how many places that are offering reverse mortgages are cons. Older people are loosing their homes at a time when they should be retired and enjoying life.
Lots of info. here..
I think that if an elderly person has no other means of support and doesnt mind not leaving anything to their children and you use a reputable company and you have plenty of equity in your home that it can be beneficial. Make sure you understand forclosure possiblities (I dont and dont know anyone who has been forclosed on)
I owuld certainly bring adult children into the picture. If they would rather provide what you need each month in order for them to keep the house, then work out something with them instead. And if only 1 child will help, then I might do a reverse mortgage with that child and let the other children know what is happening... because if you do the reverse mortgage with a finance company they dont get the house anyway.
My dad did this a few years ago. He took out a reverse mortgage for around 65k and invested the money...sounds good right? Every month the interest on the loan is about $500. Right now the pay-off is around 79k and growing. They loaned him half the appraised value of his house in a few years he will have exceeded that amount.
My honest opinion about all this is DON"T DO IT. If you own your house get a real mortgage. Invest the money so that it covers the payment and still provides you with a bit of income. Take it out for 30 years to keep the payment down and if you can, get mortgage insurance. At least in the long run your debt is decreasing not increasing. I just don't trust those guys doing reverse mortgages. Once you have exceeded the value of your house they can put a lien on the house and contents, you're only a heartbeat away from losing everything.
Probably the wisest thing you can do if you need to make some changes in your situation is to see an estate planner and get some real, up and up advice on how to plan for your future. Just my .02. B
I can see where if you truly are having trouble, a reverse mortgage might be ideal. But if there are kids in the picture and you want to leave the house or property to them, this ISN'T the way to go!
I'm sure there are costs and fees associated with a reverse mortgage, but I don't quite see the reason for a reverse mortgage. You can be sure that the companies providing the money for reverse mortgages are doing it to make it money for themselves - they aren't out to "help" the elderly person.
I would think a person would be better off selling their home (provided the kid's want nothing to do with it) and then moving in to either a smaller, cheaper house or an apartment and investing the money. (Especially if it's the same house where you raised your family - you don't need that much room anyway.)
Reverse mortgages are set up to benefit the company providing it - NOT for the person entering into an agreement.