Reverse Mortgage?

My father did that. He ended up taking less than $40,000.00 from them and then stopped taking any money. 7 or 8 years later he passed away and owed $170,000.00. The interest starts on day 1 and is based not on what you use, but on what your home is worth. Made me sick, needless to say.
 

It is a racket-and all these celebs making commercials for these thieves are disgusting.

Now-your financial situation may force you into this trap. there are events wherein your home is your only resource and you
have no alternative.

Read the info, they will provide cash, but the interest clock starts ticking.
 
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reverse compounding interest ain't your friend . it can eat up any equity in a heart beat along with the ffes , and insurance costs ...you need to pay for expensive insurance in case the bank can't get enough at sale .

also the bank can inspect the house and demand expensive repairs be done .

you may be ordered to spend a lot of money for a new roof when you are taking the reverse mortgage because you need the cash.

you may find where you live is not good as you age . then you have no equity left to move with
 
My inlaws did it, and they were quite happy when they did it, but after my father in law passed, mother and sister in law went looking at finances... and she took out a line of credit to start paying it back... and what they agreed on, and what she is paying now, I can tell you it was not worth it... Ii think itès only worth it if you have a short time to live (not being rude or insensitive) and want to go out on a bang... then it may be worth it... but otherwise I say stay away from it... Itès not worth it...
 
It worked extremely well for my wife's grandfather. I forget when he first got the reverse mortgage, but he lived to be 109 and continued to get money for the life of the reverse mortgage. It didn't make her father happy because he was hoping to get the value of the house after his father passed.
 
There are cases where it is beneficial as in post 10-depends on your needs-not your heirs.
Then there is post #5
These thieves have such a bad reputation thy we automatically say %#%@&*, but there are cases where it is appropriate.
 
They're willing to pay celebrities a fortune to advertise because they know many people are stupid enough to value their sales pitch.
Tom Selleck & Henry Winkler aren't going to pass up the big money for pitching Reverse Mortgages.....just imagine their monthly bills - for property taxes alone for all those houses.......
And Dr. Oz ain't going to pass up the money for "Green Coffee Extract" for weight loss, even though he knows it's a scam.
In the past, they've paid celebrities to push anti-depressant & hormone replacement drugs.
Recently, Ton Hanks & his wife are pushing flu shots.
 
I'm glad to see this thread, as it is something I am considering.
It's good to read everyone's opinions, cause it is a tough decision for me.

I'm really confused too. Someone has offered to help me, a relative, like doing our own reverse mortgage.
Not sure what I'm going to do. I'm having to weigh both sides.....
 
win231 said:
They're willing to pay celebrities a fortune to advertise because they know many people are stupid enough to value their sales pitch.
Tom Selleck & Henry Winkler aren't going to pass up the big money for pitching Reverse Mortgages.....just imagine their monthly bills - for property taxes alone for all those houses.......
And Dr. Oz ain't going to pass up the money for "Green Coffee Extract" for weight loss, even though he knows it's a scam.
In the past, they've paid celebrities to push anti-depressant & hormone replacement drugs.
Recently, Ton Hanks & his wife are pushing flu shots.
Click to expand...

I used to like/respect Tom Selleck before he became a spokesperson for AAG.
My feelings on reverse mortgages are that they can put you in such a hole, you can never recover. The interest rates will kill you if illness or old age doesn't.
 
I'm trying to help a friend here that is interested in the program, she asked for my thoughts on reverse mortgage and I had none, since I had absolutely no information on or history with it.

Her thought was she could take a reverse mortgage against her house, which is paid for, and use that to live on. When she passes the bank would take her home and all was good. She has no one to leave it to. I really did not know how it was intended to or did work.
 
win231 said:
They're willing to pay celebrities a fortune to advertise because they know many people are stupid enough to value their sales pitch.
Tom Selleck & Henry Winkler aren't going to pass up the big money for pitching Reverse Mortgages.....
Click to expand...

When I saw Fred Thompson's reverse mortgage commercial I knew there would be either blood or money to be had.
 
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they pay rich celebrities big money to push something that is a bad financial idea. pretty pathetic. that alone should be a red flag that they are a bad idea.
 
Bonnie said:
I used to like/respect Tom Selleck before he became a spokesperson for AAG.
My feelings on reverse mortgages are that they can put you in such a hole, you can never recover. The interest rates will kill you if illness or old age doesn't.
Click to expand...
Selleck has a perfect face for such ads. When he puckers his lips with that friendly smile, it just screams out, "Trust me; I know what I'm talking about."
 
A Reverse Mortgage (loan) would Never be an option for me. Having said that, I can see where it might be a financial tool given the right circumstances, albeit an expensive one. For those even considering it, I'd advise measuring twice and cutting once. In other words, tread very carefully for the benefits are stacked in favor of the institutions providing the loan, and the pitfalls are plenty. Just be very, very careful. Tom says you can trust them, personally, I don't... Don...
 
From the consumerfinance.gov site

"With a reverse mortgage loan, the amount the homeowner owes to the lender goes up–not down–over time. This is because interest and fees are added to the loan balance each month. As your loan balance increases, your home equity decreases.

A reverse mortgage loan is not free money. It is a loan where borrowed money + interest + fees each month = rising loan balance. The homeowners or their heirs will eventually have to pay back the loan, usually by selling the home."

The greedy banks/money lenders would not offer this unless they were making BIG bucks off it. First, they rape you with interest payments on your mortgage(s), then they go back and rape you again with reverse mortgages.

If I had money and no one to leave it to, I would establish some type of college fund or trust before I would give the banks a penny more of my money.
 
Sometimes, a reverse mortgage can be a good thing. My old parents both had declining health in their later years(both were in their 90's), and could barely take care of themselves. My Sister set them up with a reverse mortgage that allowed them to stay in their home and paid for a team of really nice ladies who took excellent care of them 24/7 during the last 2 or 3 years of their lives. They didn't want to be stuck in some Senior care facility where the prices would have been ridiculous to get the quality of care these ladies gave them. When they passed, we sold their home, paid the bank about $40,000, and still had enough left over for a nice inheritance. In their particular case, being able to live out their days at home was much better....and probable cheaper, than a good senior care facility. One of my old Aunts, in Denver, is at a top tier senior center, and she is paying about $70K/yr. to stay there.
 

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