Ask The Expert: Sounds too good to be true – what’s the catch?

Mark Schmidt Reverse Mortgage Specialist (773) 504-9633

Sounds too good to be true – what’s the catch?

There is no “catch” to a reverse mortgage. Like any loan you may be considering, it is a trade-off of costs versus benefits. The fees on a reverse mortgage can be fairly high and many people point to them as the downside to doing a reverse mortgage. Because of these up-front costs, a reverse mortgage should be a long-term solution and is most appropriate for those who plan to live in their home for at least three to five years. In the right situation, the peace of mind of unlocking the equity in your home without taking on a monthly payment far outweigh the costs of a reverse mortgage.

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Comments

Posted by: Jeff Alten — 02/08/2013

Using a dormant asset to provide additional income is what the reverse mortgage is best suited to deliver. I've spent the last 26 years showing seniors how to ensure their money lasts and in my opinion, the RM has got to be considered when doing income planning for retirees.