Reverse Mortgage Pros and Cons
If you are 62 years of age or older, odds are you have heard of reverse mortgages and possibly have been approached by a lender offering their services to you in the field. Reverse mortgages can help guarantee that you stay in your home, but they may not be for everyone. It is important to asses the reverse mortgage pros and cons before deciding that a reverse mortgage is right for you.
A reverse mortgage used to way off an existing mortgage is one of the most popular uses for services that lenders provide. Another popular solution that reverse home mortgages offer is setting up a line of credit for future potential emergencies. Many recipients over the age of 62 are on a fixed income, and are one emergency away from bankruptcy. This line of credit offered by a reverse home mortgage could provide the safety net for seniors worried about their future. Even if you drain all the equity from the home, you can still stay there. The bank cannot force you to move.
Some of the cons involved with the reverse mortgage include the high fees that are associated with them. These are not inexpensive loans. You may be looking at fees ranging from a couple thousand dollars up to ten thousand dollars. You also have to realize that you cannot pull out all the equity in your home. You can get anywhere from 60 to eighty percent equity out of your home. You also have to pay taxes and insurance on the home. In addition, the reverse mortgage may reduce the amount your heirs will receive.
For more about reverse mortgage pros and cons, contact the specialists at HML Investments today to speak with a specialists who can get you started.