Home equity loan or Reverse Mortgage?
Hi Terry, listen to you on WGN Business lunch.Always good advice. I have an equity loan and owe $39,000. Interest rate 3.75. Is there a way to get a lower rate? I am retired and 80 years old. Will appreciate any help. Also thinking of reverse mortgage. Condo is paid. Value is 185,000.
Terry Says
Once you’re retired it’s impossible to refinance a loan — even your home equity loan.
If you’re planning to live out your life in your condo, this would be a good time to look into a reverse mortgage. That will pay off your home equity loan — and give you a monthly tax-free check for as long as you live there. When you move out, or pass on, the loan will be repaid from the proceeds of the sale. Your heirs get the balance– or they can pay off the loan. But they can never owe more than the condo is worth.
But if you are thinking of moving into a senior community, then just sell the condo outright, pay off the loan — and put the balance in the bank. It won’t earn you any money– but it will be safe!
