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Old 03-07-2012, 03:02 PM
 
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I read a definition of a reverse mortgage. It is a loan against the equity in the house and paid back after death, when the house is sold.
I have 100% equity in my house.
Am I eligible for a reverse mortgage?
How to get a loan against the value of my house?
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Old 03-07-2012, 03:09 PM
 
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Yes. Check local mortgage companies or pick up any AARP magazine. Lots of info out there.
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Old 03-07-2012, 03:28 PM
 
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A video on AARP gave an example. A couple's house was appraised for about $83,000.
The got a loan of about $45,000 and $9,000 went to fees. That's right at 20% in fees.
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Old 03-07-2012, 03:31 PM
 
Location: Richardson, TX
11,427 posts, read 17,993,621 times
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I don't know enough about reverse mortgages to tell you what fees one should expect, but I'm sure they take a big cut. They don't seem to be a good choice for anybody who wishes to leave money/property to heirs who may be able to help them out with expenses in the meantime.
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Old 03-07-2012, 03:58 PM
 
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Quote:
Originally Posted by howard555 View Post
I read a definition of a reverse mortgage. It is a loan against the equity in the house and paid back after death, when the house is sold.
I have 100% equity in my house.
Am I eligible for a reverse mortgage?
How to get a loan against the value of my house?
Yes, as long as you are at least 62 years old. Having the house free and clear will allow you to borrow the most.
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Old 03-08-2012, 08:07 AM
 
11,004 posts, read 15,370,856 times
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If I was able to borrow $24,000 and the fees are about 20%, that is the same as interest of 20% (?)
The $24,000 would work out to an extra $250 per month for 8 years.
Maybe they are right when they say, it should-could be a last resort loan.
Hopefully I live longer than 8 years. An extra $250 a month is not that great, plus the 20% fees.

And if something unexpected happens and I need to move, I wonder what happens to the reverse mortgage. Early payoff fees?
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Old 03-08-2012, 11:29 AM
 
Location: Mostly in my head
19,865 posts, read 57,375,094 times
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Everyone I talked to told me it was a bad idea and should only be used if there was no other way to keep the home. I was considering it last year as i am almost 70. A friend who is a realtor and a mortgage broker were quite emphatic that the fees could eat up a LOT of money. Then I read the AARP and government web sites and realized it was not for me.
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Old 03-08-2012, 11:31 AM
 
Location: southern california
57,076 posts, read 76,102,703 times
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yes u can. probably one of the worst things u can do with a home next to renting rooms to a biker club.
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Old 03-08-2012, 12:53 PM
 
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Quote:
Originally Posted by Huckleberry3911948 View Post
yes u can. probably one of the worst things u can do with a home next to renting rooms to a biker club.
other than the fees being on the high side compared to a regular mortgage, why?

I had a reverse mortgage rep in my office the other day who stated the upfront fees have gone way down. They used to charge a 2% origination fee and she said that fee is now gone.
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Old 03-08-2012, 04:48 PM
 
3,029 posts, read 7,347,647 times
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Quote:
Originally Posted by Huckleberry3911948 View Post
yes u can. probably one of the worst things u can do with a home next to renting rooms to a biker club.
Please explain.

Turning your home into a source of income is a very attractive alternative to retired folks on fixed income. A lot better than not being able to pay your bills or enjoy your retirement. If you don't care about leaving your home as an inheritance to your kids and need additional income, why not?
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