Considering withdrawal of balance in reverse mtge of $190,000 and want to keep it safe and liquid. Thinking of money market or.. CD. We are seniors 92 and 87 years young. Please advise. Thank you
Terry Says: Wait, that’s not a good idea! You will pay far more in interest and fees if you withdraw the cash from your Reverse Mortgage line of credit than you will earn by putting the money in the bank. That’s a losing proposition. The “line of credit” is there in case you need it. Don’t withdraw until absolutely necessary. I’m assuming that you both signed for this Reverse Mortgage, and that you both plan to live in the house for your remaining years. Do check to make sure that if one of you predeceases the other, that the RM does not come due and payable. That would force the survivor out of the home, unless you (or your children) can come up with the money to repay the loan plus interest.
Do you have adult children? Have you made a plan in case one of you needs care outside the home? Now is the time to discuss those issues with your children, or the person who will have power of attorney in case you are incapacitated. I’m glad you are so young — so you still have time to plan! (If you need a resource, please write back. There is nothing sadder than what happens when seniors fail to plan ahead with a will, revocable living trust, healthcare power of attorney and other actions that will smooth the way for the survivor, and for the rest of the family.)