Comments on: What Is A Reverse Mortgage?

By: a. mccree

a. mccree — Tue, 16 Jun 2009 23:10:12 +0000

Its a great idea now if you plan on giving them their inheritance now and they won’t have to worry about selling the home they never liked. Plus they will see their parents able to enjoy their life now with the elimination of some pressing bills.

By: RC

RC — Thu, 19 Jun 2008 13:55:40 +0000

I love how all the Reverse Mortgage hucksters have piped up to defend their product. I would too if I made a living pilfering wealth from people whose only smart financial decision was paying off their home. So yeah, its not for everyone. You know what? No doc and liar loans weren’t supposed to be for everyone, either. I totally agree with the poster that thinks the marketing of this product will increase with baby boomers coming on the geriatric scene (gotta love Dennis Hopper hawkin’ retirement plans!)

Options like RAM’s only pad the pockets of those who really don’t need more. (disclaimer: I believe in a free market, but would rather see them out of business due to lack of support.) If the hippies had truly followed their “free love” ethos from their teens…their children wouldn’t be without an inheritance and charities wouldnt have to beg for money. Free love, man!

Oh, thats right!!! The boomers decided that the GOVERNMENT should provide for this!! Marvelous! Way to go boomers!

Its a sad comment on my generation and how the boomers pretty much screwed the next 5 that come behind them with their entitlements and piss poor planning. The proverbial rat is in the snakes belly now, as the first boomers are takin their geritol and readin’ AARP.

If a paridigm shift is gonna happen, its up to a new “greatest generation” that saves and passes on wealth to their heirs. Instead, we are infatuated with 24″ rims and expensive tats and piercings. Hows that gonna look when we are 85 broke and asking the government for even more money?

RAM’s (ram it to our seniors) are a bad idea in a world of selfish, bad ideas.

By: Carrie

Carrie — Tue, 15 Apr 2008 01:18:16 +0000

It is interesting… if people truly understood that most non-traditional mortgage products only fit a slim portion of the population we wouldn’t be in the trouble we are with the housing market.

Just like our current crisis, people fall prey (or fall in love with the idea of more $$$) with a product that may get them in trouble, could cost them way more than anticipated or threaten their lifestyle.

I am sure reverse mortgages are perfect from some— just not all seniors.

By: Reverse Mortgage Calculator

Reverse Mortgage Calculator — Sun, 10 Feb 2008 14:52:50 +0000

Best way to find out if it’s even worth it is to use this Reverse Mortgage Calculator that I found..Easy and fast and gives you the actual amount you could qualify for.

By: db

db — Thu, 10 Jan 2008 02:17:58 +0000

Hah! “The reverse mortgage isn’t for everyone.”

Why is it that the words “subprime lending” and “bank vultures” are flitting through my head right now? It is seriously a plan to start giving a bank back chunks of an asset you already bought and paid interest on, so that you (well, your estate) can pay it AGAIN and pay interest AGAIN?

My senior-aged parents and I are in 100% agreement that this is another dubious-at-best investment scheme best left untouched along with $0 down payment/No-interest/40-year mortgages. If push comes to shove I’ll move them in with me before I’ll let them reverse mortgage their home.

By: philip vernot

philip vernot — Mon, 07 Jan 2008 13:31:01 +0000

Well said. Thank you.

By: David

David — Sun, 06 Jan 2008 17:47:20 +0000

I enjoy reading the comments about reverse mortgages never being a good idea, that they suck, that the interest rate is high, the fees are too high, the house could be lost if property taxes aren’t paid, or that the homeowner is selfish by not leaving as much of an inheritance to the kids. These comments actually make my job wonderful, and allows me to sleep well at night knowing that I made a positive difference in someone’s life today.
I help 10 to 15 families secure a reverse mortgage each month (specifically the FHA insured version). Of those families, on average, 2 would have lost their homes to foreclosure due to high monthly payments, about 6 or 7 need to use the program to supplement their income because of the general rising cost of living, and the rest want the reverse mortgage because they know like I do, for most people, it makes absolutely no sense to keep putting money into your house when you are retired. What good does it do to have a home paid off when you are struggling every month to get by?
The interest rate is currently 4.5% for the adjustable rate, and 5.75% for the fixed rate reverse mortgage. These are considered high interest rates?
The “high cost” fees are regulated by the FHA and are completely transparent meaning there are no hidden fees in a reverse mortgage like other mortgages. Put a conventional loan and a reverse mortgage side by side with the fees, interest rates, etc. for ten years, and you would be quite surprised.
I saw a commercial that said if a homeowner with a reverse mortgage didn’t pay their property taxes, that they could lose the home. NEWS FLASH: if you don’t pay your property taxes with a reverse mortgage, a conventional mortgage, or with no mortgage, you will lose your home.
The inheritance issue. I would much rather see my mother and father enjoy their retirement years than worry about when they pass how much will be left to me. Their greatest gift to me was life. And, most kids today are doing far better than their parents. Why would you purposely watch your parents struggle?
OK, that’s enough for this Sunday morning – there really is so much more I could have written. As you can see, I am very passionate about this product because I have seen what it can do for so many people.
The reverse mortgage isn’t right for everyone. The homeowner must feel comfortable about making the best decision for themselves. Unfortunately, there are a lot of new reverse mortgage professionals out there that don’t ask the right questions, and base their conversations solely on the features, costs, and interest rates with reverse mortgages.

By: Michael Morton

Michael Morton — Fri, 04 Jan 2008 16:10:26 +0000

Reverse mortgages are never a good idea. Period.

By: Scott

Scott — Fri, 04 Jan 2008 12:57:57 +0000

My $.02: Housing market boom caused property taxes to go up and for seniors living on a fixed income this makes it difficult for them to stay in the house they’ve lived in for years and years even if it’s already paid off. A reverse mortgage can help fix this so it’s not necessarily a bad thing. HOWEVER, in my opinion a reverse mortgage is basically like trying to time it so that you spend all of the equity in your home before you pass away – a great idea if you are in need, selfish, and/or hate your kids.

By: Tim

Tim — Fri, 04 Jan 2008 11:01:17 +0000

reverse mortgages suck. the interest is high and you will not get nearly as much as the house is worth. another reason, i’m not for paying of the mortgage early.

By: Mike

Mike — Fri, 04 Jan 2008 07:48:12 +0000

The concept of reverse mortgage looks good, but i think getting one reverse mortgage for ourself involve great work since its fees is not clear, interest rate is much high and qualification is said to be complicated. Am i right?

By: philip vernot

philip vernot — Fri, 04 Jan 2008 05:57:45 +0000

Holy Cow! I originiate reverse mortgages and I can tell you this. For every 45 people who want more information, only six are even eligible. The other thirty-nine have such a high mortgage or so much debt, they simply don’t qualify. You can’t take it with you and if a reverse provides the senior with a better retirement lifestyle – Good for them!

By: vh

vh — Fri, 04 Jan 2008 04:45:24 +0000

As a leading-edge boomer who (like most members of my cohort) does not need the federal government to bail me out, thank you very much, I happen to have looked in to this issue.

From what I can tell, a reverse mortgage can be a useful tool if you reach advanced old age and have drawn down your assets to the point where you soon will be dining on cat food or if you have developed a catastrophic illness that will require nursing care and have no long-term care insurance. The advantage is that you can continue to live in your home even after you have extracted the entire value of its equity. The disadvantages are that it can indeed be an expensive option and that if your heirs want to keep the house after you pass, they will inherit the place with a mortgage. They have to repay the lender what you borrowed against the equity. If they choose to sell the house, the lender has a lien in the amount you borrowed.

If it matters to you whether you can leave a paid-off house to a son or daughter (a valuable asset in these times, when housing is largely out of reach for young people), then a reverse mortgage is not the instrument for you. On the other hand, it may be better to sacrifice home equity than to have to depend on one or more children to support you — that may be a bigger burden for them than the loss of the house.

By: Mrs. Micah

Mrs. Micah — Fri, 04 Jan 2008 04:06:06 +0000

“I’ve always thought a reverse mortgage would be a great idea. I mean, what are you going to do with your house once you’re dead, anyway? Of course I’m a long way from actually needing one – but I should have paid off my own mortgage by the time I’m old enough to qualify and I can look into it more then.”

Plonkee, I’d thought about this for my parents, if need be. That is, if my father passed away and my mother couldn’t quite finish the mortgage (they’re close to outright owning, but not quite there). With my mom’s cancer, it might help cover expenses or help her enjoy her last years a bit more… But if she needed to move to a nursing home or something like that for a period of time, she wouldn’t be living in the house and might lose it.

By: Livingalmostlarge

Livingalmostlarge — Fri, 04 Jan 2008 04:01:40 +0000

I don’t like it, but seriously how many people do you know who have a paid for home and no savings? Sigh, and how many more will refuse to move or sell their home?