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Not if you choose "tenure" as your payment plan. You would continue to receive payments for as long as you live in the house, even if those payments over an extended period of time vastly exceed the value of the house. There is no "prescribed amount of time" when the payments would stop.
this is correct but because they base that tenure payment on an age of 100+ , and count such a small part of the total equity in the house the payments end up quite small compared to what folks think they will get based on the actual home value .
I may have posted this before and I do not intend to read all posts to find out. A Reverse Mortgage is tricky but under the right circumstances could work for someone.
I say the first consideration/trick is if you are alone (as in no spouse) and not concerned with leaving things to other people than investigate them further. If neither, than probably not a good move.
I may have posted this before and I do not intend to read all posts to find out. A Reverse Mortgage is tricky but under the right circumstances could work for someone.
I say the first consideration/trick is if you are alone (as in no spouse) and not concerned with leaving things to other people than investigate them further. If neither, than probably not a good move.
Not so as far as being married. If both spouses qualify for the RM and are on it, either spouse can remain after the first spouse dies, until they are both deceased.
OTOH if one spouse is under 62, or if the surviving spouse remarries, the spouse not on the mortgage would have to move when the spouse that is on the mortgage dies.
the biggest risks are that the more rural the area the greater the chance this is not where you want to age .
health conditions may eventually dictate where you need to live and the resources you will need .
that may leave you in trouble with a reverse mortgage .
not being able to drive and needing public transportation , or needing some care from non local family as well as special medical services or facility's are all very likely forcing a move .
reverse compounding interest ain't your friend and it quickly can eat up home equity and leave you with no home and no money if you need to relocate
I may have posted this before and I do not intend to read all posts to find out. A Reverse Mortgage is tricky but under the right circumstances could work for someone.
I say the first consideration/trick is if you are alone (as in no spouse) and not concerned with leaving things to other people than investigate them further. If neither, than probably not a good move.
Quite correct. It is a consideration to take should income be at risk. Let's say a spouse becomes homebound and needs additional care the RM could be brought in. Other circumstances are less helpful because they are more likely not needed. If someone is home rich but investment/cash poor that can help bridge the gap but the family that has an expensive house would more likely have savings than not.
Quote:
Originally Posted by Cruzincat
Not so as far as being married. If both spouses qualify for the RM and are on it, either spouse can remain after the first spouse dies, until they are both deceased.
OTOH if one spouse is under 62, or if the surviving spouse remarries, the spouse not on the mortgage would have to move when the spouse that is on the mortgage dies.
Excellent posts.
Also those who have heirs and were planning on leaving something need to consider and consult with family before committing to a RM. Though the house can go to the heirs they will be obligated to pick up that mortgage by paying it off or by refinancing if they are wanting the home. In that case a home equity loan would be a better choice.
a reverse mortgage is really a balloon payment equity loan .
you sign all the paper work for a loan and that loan comes due under certain conditions . however you already signed the paper work called a deed in lieu or a deed in trust in some states where you give them the ability to take the house without a judgement or foreclosure in exchange for payment of the loan .
but you or your heirs will be sent a payment due notice at some point .
a reverse mortgage is really a balloon payment equity loan .
you sign all the paper work for a loan and that loan comes due under certain conditions . however you already signed the paper work called a deed in lieu or a deed in trust in some states where you give them the ability to take the house without a judgement or foreclosure in exchange for payment of the loan .
but you or your heirs will be sent a payment due notice at some point .
I learned another side of reverse mortgages watching my sister with hers. I was very much against them and told her so. She passed recently and it was one of the best things that could have happened for her.
She had used only about one third of the credit line when she became seriously ill. She needed 24/7 home care occasional hospitalization and eventually nursing home care. My niece was able to pay for everything with the reverse mortgage and other assets. She was about a week away from going on Medicaid when she passed. Because of the reverse mortgage she was able to enjoy her healthy years more and provide for quality care at the end. She was able to get in and afford a top nursing home.
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