The reason I'm writing this article is I'm getting many questions from my customers asking me if this is the reverse mortgage is the right answer for them.
The truth is the reverse mortgage is not a great decision for all borrowers. Situations are unique and they must be evaluated individually.
I have a few borrowers with a bunch of money in savings but the majority have next to nothing and are looking for financial answers.
Generally speaking most are on social security and some form of pension, but others are still working and planning on retirement.
My concern is the worst case scenario. If someone really ran into a major financial need, like a medical issue, would they be able to handle it?
Lets face it life happens and we have to be ready for it. That means we have to be financially ready.
I know most of these folks will be getting the reverse mortgage with me. I simply advise that the funds are used in a prudent manner. Increased disposable income tends to get spent.
These borrowers have worked very hard to build up the equity in their homes. It is their nest egg, and if it is squandered what money will be there for them if they really need it?
For a very conservative perspective one should use the reverse mortgage when it is absolutely needed. If a mortgage exists maybe it is best to wait to refinance it with a reverse mortgage.
If there is no mortgage I like to see folks use the line of credit option and use their proceeds sparingly. By using proceeds this way interest accrues minimally against the equity of the home.
Serendipity of the line of credit is the unused portion of the money line accrues interest and actually grows. This has the net effect of growing the line of credit for use later.
As a guy who gets people these loans I know they are a real benefit. However, they can be misused and I implore you to use them with care. - 15224
The truth is the reverse mortgage is not a great decision for all borrowers. Situations are unique and they must be evaluated individually.
I have a few borrowers with a bunch of money in savings but the majority have next to nothing and are looking for financial answers.
Generally speaking most are on social security and some form of pension, but others are still working and planning on retirement.
My concern is the worst case scenario. If someone really ran into a major financial need, like a medical issue, would they be able to handle it?
Lets face it life happens and we have to be ready for it. That means we have to be financially ready.
I know most of these folks will be getting the reverse mortgage with me. I simply advise that the funds are used in a prudent manner. Increased disposable income tends to get spent.
These borrowers have worked very hard to build up the equity in their homes. It is their nest egg, and if it is squandered what money will be there for them if they really need it?
For a very conservative perspective one should use the reverse mortgage when it is absolutely needed. If a mortgage exists maybe it is best to wait to refinance it with a reverse mortgage.
If there is no mortgage I like to see folks use the line of credit option and use their proceeds sparingly. By using proceeds this way interest accrues minimally against the equity of the home.
Serendipity of the line of credit is the unused portion of the money line accrues interest and actually grows. This has the net effect of growing the line of credit for use later.
As a guy who gets people these loans I know they are a real benefit. However, they can be misused and I implore you to use them with care. - 15224
About the Author:
Live in Texas.. get a great 12 page reverse mortgage guide here. Also, Have 20 questions answered about the Texas reverse mortgage at this linkright here.
