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Probably Not...........
Before we look at whether a reverse mortgage is a good deal, first let define it. They operate much like a home equity loan and are limited to individuals that are at least 62 years old.
Unlike a typical home equity loan, a reverse mortgage does not consider a person’s credit history or income.
Reverse mortgages are complex and carry high fees so be careful when considering all the aspects of the deal. In addition to traditional closing costs there may be also an origination fee, mortgage insurance premium and other upfront costs.
The amount a person gets from the reverse mortgage will be based on expected interest rates, the lower the better. Seek a fixed rate if possible, you will get a lump sum up front and the amount will be reflected by the assessed interest rate.
These types of mortgages can also be used to purchase a new home with no monthly mortgage payments.
The vast majority of reverse mortgages are guaranteed by HUD through mortgage insurance charged to the borrower.
The amount a person receives will be based on their age, the amount of equity in the home and interest rates.
Makes sure that you can get reliable assistance, as many mortgage brokers are in the business without completely understanding the ins and outs of reverse mortgages.
Daniel Iuculano, AAMS CMFC
Financial & Wealth Planner
