A lot of people like the idea of a reverse home mortgage because it lets the owner stay in the home. There are no payments on the loan until you permanently leave the home.
It sounds like a great way to get the best of both worlds: staying in your home and having money too.
But is a reverse mortgage a good idea?
If you think it is, read on…
The upfront fees for a Reverse Mortgage are somewhat high. These include closing costs, insurance costs and origination fees. While these fees are financed by the Reverse Mortgage Company, they are typically higher than the costs charged for refinancing.
Even if you have a lot of home equity, a Reverse Mortgage will only let you to use some of it.
The actual loan amount you may be entitled to is determined by a calculation that uses the appraised value of your home, the amount of money you owe on the home, your age and current interest rates.
Some people believe that because there are no monthly payments that there are no costs to a Reverse Mortgage. They fail to realize that the loan amount – the amount you will eventually have to pay back – grows larger every month. In addition the amount of interest you will eventually owe increases - because it accumulates.
A traditional mortgage is an upfront loan of a fixed amount that is repaid over time. A Reverse Mortgage is the opposite – you accumulate the loan amount over time and pay it all back when you no longer live in the home.
Other Fees and Costs
If you do have a Reverse Mortgage, you are still responsible for paying for upkeep, taxes and insurance on your home.
If you are struggling financially, the best solution may be to take a clean break from your house. Managing a lump sum of money to cover your living expenses may be easier than constantly wondering what new expense may come up.
If selling this spring isn't something you wish to consider right now, we can help.
If you have come to the realization that it is time to move right now to have a better life, but your house isn’t ready for the traditional market, we can help.
If you are juggling too many responsibilities to sell your house yourself this winter, then there are people who specialize in the sale of properties "as is" - usually within a week to resolve the situation quickly. We have a team of professionals able to assist you immediately.
Contact us for details.
So thanks for reading my post. I'm so glad you're here!
And I really look forward to getting into more great stuff in future posts -- so that you can
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