Reverse mortgage Questions, final round

How is a reverse mortgage different than a regular mortgage?

There are three primary differences;

·         There are no income requirements

·         There are no credit requirements, and

·         No loan repayment for as long as you live in the home

 

Aren’t reverse mortgages expensive?

There can be significant costs associated with a reverse mortgage, however most of these fees can be financed as a part of the mortgage.  For those that are concerned with fees, some programs offer reduced or no fees. 

 

What else do I need to know?

·         You can never owe more than your home is worth.

Reverse mortgages are “non-recourse” loans meaning that the lender can never look to anything or anyone beyond the value of the home.  Your estate will not owe anything to payoff the mortgage balance.  In addition, some programs allow for “setting aside” a protected portion of your home’s value that will stay with your estate.

·         There are no restrictions if you wish to sell the home.

The balance of the reverse mortgage is paid off as a part of the sale just like any other loan.

·         You can’t be pressured into a reverse mortgage.

ALL of these programs require counseling from an independent counseling agency.  In addition, we welcome you to bring your advisors with you as we are discussing the programs.  We would also be happy to provide you with booklets from AARP –Home Made Money, a consumer’s guide to reverse mortgages, or Fannie Mae’s Money from Home – A Guide to Understanding Reverse Mortgages.

contact me at scott@scott-larson.com for more information