Anybody know ANYTHING about Reverse Mortgages?

[romantico]

I've been on Google & I've been on the AARP message boards. I even checked out over the weekend a book called "Reverse Mortgages for Dummies". With all my research I have found that some people think they are TERRIBLE & a con. Others think its the greatest thing they ever did.I suppose for each person its different.



My question is, has anyone here ever had any expierence (pleasant or unpleasant)with RM's?

[undeterred]

1. What is a reverse mortgage? Does the bank pay you?

I want one.

[pitohui]

4. yes you need to be over age 62

there are different reverse mortgages but it's a way for an older person with a paid-off home to get income from their home

the catch is that when you die, the bank gets the house obviously, however, if you are dead, you don't need a house, so it is not much of a catch

that is just the short answer to give you the gist, there are different kinds of reverse mortgages and of course the kids hanging around like vultures who expected to inherit the house will not be too happy but if they are not paying your bills, then i think you need to take care of you

[flvegan]

5. No

the bank DOESN'T get the house when the mortgagor dies. If the payments stop, they can forclose, yes. Some folks buy insurance for just such an event.

In most states, for the bank to just "get the house obviously" the bank would not only need the mortgage/note, but a deed from the owner to the bank, likely reserving a Life Estate.

[Gormy Cuss]

10. That's how it works with legitimate reverse mortgages from

reputable companies. There are horror storie about sleazy companies who manage to add language that stipulates that they are due what they paid out AND the increased value of the house. I just read a sob story on such a scammer.

Done properly, reverse mortgages can be a great way to be able to afford to stay in your own home in retirement.

[pitohui]

12. well it depends on the type of reverse mortgage obviously

in many cases you're basically selling the house and getting paid for the house but you get to live in for the duration of the note or your lifetime

actually on reading your comment i'm not sure what type of reverse mortgage you're referring to where the bank would pay you for the house and still not want the house at some point

banks are in this to make money and usually they are gambling that you'll die way before they have to finish making 30 yrs of monthly payments to you for the house, causing them to get a bargain

meanwhile as long as you live you have a monthly income and a place to stay

that is the kind of reverse mortgage the elders i've known to do this have done, don't know of any horror stories, sure, maybe some greedy kids would have preferred their mom live in poverty and have nothing in her old age so they would inherit more, but i don't call that a horror story

[flvegan]

15. Well

banks aren't in the real estate business. They don't want the property, rather, what they want is a performing loan, or the money back to make an additional performing loan.

In few cases are you "selling the home" to a lender, or at least, a legit one. The bank is happy to collect interest, regardless of who, or from where it comes. So long as, at the end of the day, they either have their money or their collateral, they don't care.

[matcom]

2. plenty

pm me

totally DEPENDS on the situation

could be WONDERFUL, could be DISASTROUS

on edit: you should know i am NOT a mortgage broker. i run IT for a mortgage company

[flvegan]

3. I agree with matcom.

You can also pm me for another view/elaboration on what matcom might say.

And yes, I'm a professional in the industry.

[romantico]

6. I've done research

I agree. The bank doesn't get your house. I think back in the old days Reverse Mortgages had a taboo about them.I think depending on the situation it can be good & bad. My Mom doesn't need alot of money & they are willing to pay off the rest of her mortgage is about 20 grand. She's owned the house for about 22 years now. She plans on selling the house when she's 80, so she'd like to stay for atleast another ten years. Thanks again to all who have PM me. Really helpful advice! I DO appreicate it!!

[flvegan]

7. Check your PM.

We have many options and alternatives she could/should consider.

[rug]

11. Well, this explains a lot.

[Momgonepostal]

8. My mother has had one for a little over a year...

I need to go to work soon, but the bottom line is she is happy with it. It was very important for her to stay in her house. And the mortgage company will make a payment to her every month, regardless of how long she lives. She can't max it out, if that makes sense.

[pitohui]

14. yes it makes sense, that is the kind to have EOM

.

[NewJeffCT]

9. I tried to tell my Aunt about them, but she didn't even want to listen

She had a home that was paid off entirely and no other debt and a decent amount of savings and a pension. Her home was immaculate (we joke that my mom and my aunt are the Special Forces of cleaning!)

She retired maybe 2 years ago.

However, since she lived alone for the past 10 or so years since her husband died, it's a bit of work for her to maintain a home with mowing the lawn, trimming the shrubs, shoveling the driveway in the winter, etc. by herself... in addition to property taxes.

She was worried that she couldn't handle everything herself & also pay folks to take care of the lawn. (She tends to overdramatize her problems)

I had suggested looking into a reverse mortgage, but she up & sold her home & moved into one of those 55 & Over communities without even looking into the reverse mortgage.

[Commie Pinko Dirtbag]

13. Damn you.

Now I had to post a copycat with the approximate half-life of Darmstadtium.

[Floogeldy]

16. Seems to me it is wasting an asset.

But I guess we don't live in a perfect world. Thanks to "you-know-who" we live in a fucked up world.