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I agree, which is why a reverse-mortgage line of credit would be my absolute last resort.
As far as interest expense, I'd have to compare the cost of obtaining a conventional home equity line of credit (if I could even get one, based on Social Security being my only income) vs. a reverse mortgage line of credit. But the smartest (meaning least-expensive) way would be for my son to advance the money (which is likely to be about $5000/yr if my projections are correct) so that he will inherit the house free of any liens or pressure to sell after I die. Logically it should be easier/smarter for him to come up with $5000 once a year for, say, 10 years than to come up with $50,000 + interest all at once at the end of the same 10-year period if I were to go the reverse mortgage route.
Can you rent it out. I’m sure you could get at least $5k per year.
@Strawberry, I wear seatbelt for a reason. I’ve yet to get into a nasty accident yet. But I know my massage therapist who has a brother, he used to be a taxi driver in his old country, came here decided not to wear seat belt because he didn’t before. Guess what happened to him. Got into a nasty accident and he’s now a quadriplegic. Thanks but no thanks. I’m not smart to make those kinds of decision
About 40% of homeowners nationwide have no mortgage. Unless you spend your life renting, equity mining or moving to more expensive digs, most seniors will be mortgage free by the time they retire.
1031 is IRS code. Which is federal. And applies to every state. Including CA.
but you can't 1031 a primary residence regardless . 1031 is only for investment property. they can end up biting you too ... we delayed a sale and it cost us a fortune in more taxes .. the capital gains rate jumped from 15 to 23.80% for the sale so kicking the can down the road sucked for us
Last edited by mathjak107; 03-05-2019 at 04:47 AM..
About 40% of homeowners nationwide have no mortgage. Unless you spend your life renting, equity mining or moving to more expensive digs, most seniors will be mortgage free by the time they retire.
"The survey, "Retirement and Mortgages," by national mortgage banker American Financing, found 44 percent of Americans between the ages of 60 and 70 have a mortgage when they retire, and as many as 17 percent of those surveyed say they may never pay it off"
I agree, which is why a reverse-mortgage line of credit would be my absolute last resort.
As far as interest expense, I'd have to compare the cost of obtaining a conventional home equity line of credit (if I could even get one, based on Social Security being my only income) vs. a reverse mortgage line of credit. But the smartest (meaning least-expensive) way would be for my son to advance the money (which is likely to be about $5000/yr if my projections are correct) so that he will inherit the house free of any liens or pressure to sell after I die. Logically it should be easier/smarter for him to come up with $5000 once a year for, say, 10 years than to come up with $50,000 + interest all at once at the end of the same 10-year period if I were to go the reverse mortgage route.
for many , reverse mortgages just stall the inevitable , which is they just can't afford the house .. 90,000 reverse mortgages are behind in taxes and insurance and will likely be foreclosed on according to hud ..
for many , the reverse mortgages eat equity up so fast that now , when they have to move for one reason or another they have no money and no equity left ..
not being able to drive and living in an area with no public transportation , not being able to take care of the house or wanting or needing to be closer to family are the biggest culprits.
helocs are way cheaper but to get heloc's now you need to meet the same criteria as a mortgage... odds are if you are in a position to need a reverse mortgage there is a good chance you won't meet the criteria for a heloc .
also as i mentioned helocs were closed down all over the place in 2008 when banks had no money to loan .
we actually looked in to a reverse mortgage to purchase ... we were thinking of buying a condo in a beautiful building which we could never buy because they are so expensive .
but we could put down half and not pay for a mortgage ever again .
the terms were so horrible because these are high risk loans to seniors that we said forget it . it ate up so much equity so fast that in good conscience we could never get ourselves to do it .. the fees , reverse compounding interest and special insurance you need to carry for the lender were brutal
Last edited by mathjak107; 03-05-2019 at 04:48 AM..
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