Reverse mortgage
We are 76 and our house is paid off. What do you think of reverse mortgage? We have credit cards debt ,car payment and new furnace debt.
Terry Says
That all depends on how long you think you will be staying in your home. And I know that’s a tough question right now.
But reverse mortgages carry an interest rate that helps eat into the equity in your home. And there are set-up fees, as well. So this strategy doesn’t work if you don’t think you can live there, and pay for upkeep, property taxes, and insurance for at least 10 years.
Read this recent article I wrote about those issues: https://www.terrysavage.com/reverse-mortgage-rules/
But let me say, I did a reverse mortgage for my Dad and it worked out so well. He lived in his condo until a week before he died –at age 95! And the checks kept coming! (It cost the lender, but they are insured against that possibility!) There was no equity left in the condo when he died — but he enjoyed it every day. (And yes, I was there to help when there was a special assessment, etc.)
So Reverse Mortgages can be a great solution — if you do your homework. Independent counseling is required so you get your questions answered before you go through the process.
