Reverse Mortgage Disadvantage #1: It is a loan and it has to be repaid when the senior moves or pass away. All banks and lenders are in business to make money. A reverse mortgage lender is no different. When they lend you money, it has to be repaid plus interest in it. This is a business transaction, you get the fund, the bank puts a lien on your home, the lender gets a guarantee that they will be repaid when you move or pass away.
You get what you pay for in this world. If you want bottom-of-the-barrel rates and fees you will usually have to go bottom fishing among the lenders. Use a reputable reverse mortgage lender who gives you solid answers to your questions and does not try to entice you with the promise of the lowest price.
Because of the high costs associated with Reverse Mortgage, if you intend to leave your home within 2-3 years, they may be other less expensive options to consider.
Reverse Mortgage Disadvantage #3: Once you have the Reverse Mortgage, it permanently reduces the equity in your home. A Reverse Mortgage enables you to access your home's equity just like a regular home equity loan. The more of it you take out, the less you will have.
Reverse Mortgage Disadvantage #4: Even though it does not affect Social Security or Medicare benefits, the proceeds from the Reverse Mortgage could impact Medicaid eligibility. If you use the money right away, its fine. Any funds retained would be count as an asset and could impact Medicaid eligibility.
Reverse Mortgage Disadvantage #5: People you know might think you are crazy to apply for Reverse Mortgage loan. They are many myths and misconception about it and they are all over the newspaper. Many banks had taking advantage of average people in need of money. This program is not for everyone, the best thing to do is to investigate and talk to a HUD certified counselor.
Reverse Mortgage Disadvantage #6 Borrowers are responsible for paying taxes, homeowners insurance, utilities and keeping the home in good condition. If Lender finds out the property is in disrepair, they will make you repaid the loan.
everse Mortgage Disadvantage #7: A reverse mortgage may not be the singular, ultimate, all-encompassing answer to your financial goals. You do not have unlimited amounts of home equity and a reverse mortgage does not change that. It is merely a means of tapping into the home equity that you do have. You will qualify for a given amount of money upfront.
Before you apply for the Reverse Mortgage program, make sure you understand it and review all the alternative options, understand Reverse Mortgage Disadvantage. Your home is your number one asset, don't use the equity lightly.
You get what you pay for in this world. If you want bottom-of-the-barrel rates and fees you will usually have to go bottom fishing among the lenders. Use a reputable reverse mortgage lender who gives you solid answers to your questions and does not try to entice you with the promise of the lowest price.
Because of the high costs associated with Reverse Mortgage, if you intend to leave your home within 2-3 years, they may be other less expensive options to consider.
Reverse Mortgage Disadvantage #3: Once you have the Reverse Mortgage, it permanently reduces the equity in your home. A Reverse Mortgage enables you to access your home's equity just like a regular home equity loan. The more of it you take out, the less you will have.
Reverse Mortgage Disadvantage #4: Even though it does not affect Social Security or Medicare benefits, the proceeds from the Reverse Mortgage could impact Medicaid eligibility. If you use the money right away, its fine. Any funds retained would be count as an asset and could impact Medicaid eligibility.
Reverse Mortgage Disadvantage #5: People you know might think you are crazy to apply for Reverse Mortgage loan. They are many myths and misconception about it and they are all over the newspaper. Many banks had taking advantage of average people in need of money. This program is not for everyone, the best thing to do is to investigate and talk to a HUD certified counselor.
Reverse Mortgage Disadvantage #6 Borrowers are responsible for paying taxes, homeowners insurance, utilities and keeping the home in good condition. If Lender finds out the property is in disrepair, they will make you repaid the loan.
everse Mortgage Disadvantage #7: A reverse mortgage may not be the singular, ultimate, all-encompassing answer to your financial goals. You do not have unlimited amounts of home equity and a reverse mortgage does not change that. It is merely a means of tapping into the home equity that you do have. You will qualify for a given amount of money upfront.
Before you apply for the Reverse Mortgage program, make sure you understand it and review all the alternative options, understand Reverse Mortgage Disadvantage. Your home is your number one asset, don't use the equity lightly.
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Want to find out more about Reverse Mortgage Disadvantage, then visit Paul Hong's site on how to choose the best Reverse Mortgage for your needs.. This article, Reverse Mortgage Disadvantages is released under a creative commons attribution license.
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