- Do you need a Reverse Mortgage? Consider the high costs of these mortgage to make sure they are right for your scenario. A Reverse Mortgage should provide a solid result to accomplish life planning, its not a short term fix. In other words, not be be used for a vacation but because you want to remain in your home and income is limited.
- Can you afford it? Reverse mortgage have high upfront costs, and as the negative amortization aspect of the loan increases your home equity decreases. A Reverse Mortgage is a long term solution not a short term one.
- Can you afford using up your equity in your home? Once again, a Reverse Mortgage is a long term solution, where if a individual wants to remain in their home and have limited income than they are a good solution. If you take out a Reverse Mortgage be sure to use the credit line obtained for important things like house repair, health care needs as apposed to a extra vacation.
- Are there less costly options? If you have the ability income wise to afford a forward mortgage (Home equity or a 1st Mortgage) than they may be a better option, if your income is limited then the Reverse Mortgage may be the better option.
- Make sure you understand how a Reverse Mortgage works? A Reverse Mortgage is a loan that a monthly payment is never required where a forward mortgage requires a monthly payment. A Reverse Mortgage will slowly take away your equity where a forward mortgage builds equity when monthly payments are made.
Tue, Apr 21, 2009
Mortgages, Reverse Mortgages