Reverse Mortgage is a Bad Idea When…..
Married? Spouse not 62 years of age yet?
We know there is some circumstances where you are in dire need of money and the reverse mortgage program will open up funds to survive and manage your bills, but we insist that the last possible solution would be to refinance into a reverse mortgage if your wife/husband is not 62. If you pass away before your spouse they are obligated to sell or refinance the property within six months of you being deceased. May not be an option if they are on a fixed low income.
Kind of Need Some Money?
If you are not in a financial hardship and you have access to additional funds then we suggest that you wait until refinancing. Refinancing into a reverse mortgage would provide the funds that will need to last the remainder of your life.
Need Some Money Just For Short Term?
If you only need enough money to last you less than five years then we suggest that you hold off until then. You may have a trust fund or extra money coming your way at that time. Reverse mortgage funds should only be reached to if you are facing a financial hardship and you don’t see any change in the future.
Property Value Really Low?
This is a really hard one to determine if this loan is going to be a suitable for you as a senior. If you home is worth $30,000, you are looking at the same amount of fees as a $100,000 home. I would find out first how the market in your area is doing and see if there is a promising future for homes moving upwards in value. If not and you desperately need the funds to survive then and only then we suggest you moving forward with the reverse mortgage program
Want to Invest in Stocks, Other Real Estate, Etc.?
This is a HUGE decision to make and may possibly diminish all of your equity in your home and never return any kind of profit. We highly suggest that you do not approach this way. These are the funds that need to last you the remainder of your stay on this earth. Please use those funds wisely.
Life insurance salesman tries to encourage seniors to refinance their home into a reverse mortgage and use the funds to purchase an annuity. The reverse mortgage program offers a “Tenure” payment which offers the same thing. You are already paying your lender fees to handle your loan, why pay a life insurance agent to provide the same feature?