REVERSE MORTGAGE INFORMATION: Tools, News and Resources to Help Seniors Decide

Thinking about Retirement


I came across this by a young couple planning their own [tag]future retirement[/tag]. I found it interesting reading and was encouraged that “30-somethings” are starting to weigh the pros and cons of [tag]reverse mortgages[/tag] in their future plans:

If we use a reverse mortgage we can stay right where we are but at the risk of never being able to move. For example, let’s say we have taken out a reverse mortgage. All the money we are lent earns interest which is due back to the lender. But the interest is secured against the equity of the house. The good news is that if the amount we owe exceeds the value of the house the lender looses, a reverse mortgage only allows the lender to get the equity in the house and that’s it. But interest is due on all money lent out under a reverse mortgage and that interest is charged against the equity in the house. The end result is that a reverse mortgage can very quickly eat up all the equity in the house. So if we decide we want to move, for whatever reason, we can easily find ourselves with no equity left in the house and so no funds with which to move. In a very real sense we end up prisoners in our own home.

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