Renting your home and making money out of your property during the final years of your life is now made obsolete with reverse mortgage. Recently introduced loans, a reverse mortgage allow couples over 62 years of age to postpone the mortgage payment till both or anyone among the couple dies. Upon their death the house is used for nursing home or alike. The humble objective behind this type of mortgage is to allow the owner to stay until their death without making any monthly payments.
However, nice packaging of a new loan should not be the reason to buy it unless you know all its angles. Let us see reverse mortgage loans with a fresh pair of eyes.
Reverse mortgage loans are associated with high fees and it is essential to compare with regular mortgage before applying for it. Usually the consequences are never much advertised by the advocates of reverse mortgage. In many cases it has been observed that this type of loan charges a monthly fee like home equity loans. Make sure that such hidden costs are not associated before moving for it.
Jumbo reverse mortgage are often a lucrative deal as they provide a higher sum that goes beyond highest bound. It sounds very tempting but right now it is a precarious affair since FHA has stopped insuring these types of massive loans. In case of jumbo mortgage or lifetime loans the closing charge is a bit higher. It can now be well inferred that such kind of loan financing is not a very profitable option.
Reverse mortgage loans has a unique characteristic that none of the financers are expected to feature. In case any senior citizen obtain any kind of public assistance, be it cash, medical or food, through government aids, then the funds thus collected in savings or checking account from reverse mortgages will be counted against them. This is a serious impairment of lifetime mortgage loans for senior citizens who cannot afford their medical assistance or food.
Next time when you hand over your sweet home to a financer of reverse mortgage be sure to negotiate the above issues. Even of the reader of my blog entry is not a senior citizen, don’t ignore the matter. A few handy tips today have the ability to grant you merry tomorrow.