Who can get a reverse mortgage?

Someone 62 or older with a house that is his or her main residence and who has received counseling and has a certificate to prove it.

Who should get one?

One ideal candidate is someone who is “house-rich and cash-poor.” And anyone with a continual need for money, not just a colossal need right now. “Continual” is the key word. Other ideal candidates are people who want cash – to live a more comfortable life. They are not the same as people who need cash.

How much can I get?

If You Don’t Sell the House

You are not required to sell the house. But you are required to repay the loan, up to the value of the house.

 In your will, you could leave instructions that other assets of yours are to be sold to pay off the loan, so your heirs can inherit the house. Check with your heirs first.

Your heirs might inherit the house and then use a traditional or forward mortgage to pay off the loan, assuming that the house has kept its value. Then one of your heirs can live in it, perhaps paying rent to the other heirs. Or the heirs can simply rent out the house, holding it as an investment.

1) They can be complicated and confusing.

2) If the homeowner leaves the house, or dies, soon after obtaining the mortgage, the cost of the loan will have been very high.

3) The homeowner’s heirs will probably wind up with less of an inheritance.

4) Cash payments from a reverse mortgage are usually lower than the payments you might receive if you sold your house and invested the money in an income or immediate annuity.

5) Three days after signing a contract, you no monger can change your mind.

Top 12 reasons to consider a reverse mortgage

12. You can continue to live in your house. You need not move to a new place where you might have to find a new doctor, a new barber/beautician, a new accountant, a new lawyer, a new stockbroker, new friends. Along with new restaurants, new stores, new garage mechanics. You also won’t have to learn new routes, new streets, new shortcut.

11. You can receive cash – to pay your bills, to improve your lifestyle. More meals out; more shows; more trips; new, better clothes. Yu may be able to afford gifts for your children and grandchildren.