Should I get a reverse mortgage if I'm looking to retire in the next couple of years?

Asked by Lynn

6 Answers

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Answered by Michael Prozy, Mortgage Broker in Columbus, OH
On a traditional mortgage loan the homeowner must make monthly payments to repay the debt and gains equity in the home. A reverse mortgage is the opposite. Instead of making monthly payments to the lender, the homeowner receives payments from the lender and loses their equity in the home.
Reverse mortgages have their benefits but are not for everyone. The first thing you should do is take some time to put together what your short and long term financial goals are. Based on that, my best advice to you would be to do as much research as you can on reverse mortgages. I would also take the time to learn about other loan programs available that may also meet your needs. I would be more than happy to help educate you on all of these programs in greater detail if you like. This way you can make the best decision for you and your family.
| 10.02.13 @ 19:07
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$commenter.renderDisplayableName() — {comment} | 12.05.16 @ 04:33
Answered by James Talbot, Mortgage Broker in Metairie, LA
If you income is dropping and you are looking for a way to safely lower you outgoing payments, yes it is a great idea to get a reverse mortgage. Typically, the biggest concern is that over time you will lose equity in your home in return for the comfort of no mortgage payment. If you are good with that idea than a reverse may be right for you. | 10.03.13 @ 14:24
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$commenter.renderDisplayableName() — {comment} | 12.05.16 @ 04:33
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Answered by Alan
Lately, financial advisers have been advocating reverse mortgage as a tool that can be beneficial to your financial planning.
A reverse mortgage allows the borrower to borrow against the equity and receive regular payments without selling their home or making monthly payments to the lender, which can help those who are looking for additional financing to their retirements. My biggest advice is to research and learn more about reverse mortgages to see if it is right for you. | 10.30.13 @ 23:02
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$commenter.renderDisplayableName() — {comment} | 12.05.16 @ 04:33
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Answered by Michael
The question is too vague. If you can retire comfortably without touching your home equity, then no you should not. However if you want to maximize your monthly income after retirement, this would help you achieve that. Right now you can take advantage of a new product called the HECM Hybrid ARM this is going to get you the lowest rate, no origination fees are required and still maximize your principle limit. | 10.07.14 @ 02:38
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$commenter.renderDisplayableName() — {comment} | 12.05.16 @ 04:33
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Answered by Michael
On Second thought, with interest at or below inflation, I would leverage as much as you can as long as you can. However keep in mind at age 62 you qualify for a HECM as long as you have 40% or more equity in your home. This will allow you to pay off your mortgage for good an replace it with a loan that never requires payment until you pass away and its guaranteed never to exceed the value of the home. FHA insures you will always have a minimum of 10% equity in the home, no matter what. To top it all off, the rate is currently at 2-2.5% and with us, you wont pay any origination fees. | 10.14.14 @ 17:36
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$commenter.renderDisplayableName() — {comment} | 12.05.16 @ 04:33
Answered by Ted Rood, Mortgage BrokerPRO+ in Maryland Heights, MO
Reverse mortgages are a great tool, in certain circumstances, and an expensive mistake in others. Their interest rates and costs are higher than typical mortgages, and the amount available to borrower varies widely by the occupants' ages. Someone in their mid 60's may need 50% or so equity to take out a reverse mortgage, whereas an 80 year old would need far less equity. If you're still working and have decent credit/equity, you might consider a home equity line instead of a reverse mortgage. You can borrow only what you need, make future draws against the line, and pay interest on the borrowed funds only. Home equity lines are typically very inexpensive to take out, often with fees under $1000. Hope that helps, Ted | 08.25.15 @ 19:37
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$commenter.renderDisplayableName() — {comment} | 12.05.16 @ 04:33
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Answered by

Ted Rood
Ted Rood, Mortgage BrokerPRO+ in Maryland Heights, MO

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