Are you sure a reverse mortgage is right for you?
A reverse mortgage for many people is an opportunity to save their home from foreclosure, pay off medical bills or pay for care of a spouse. But it’s not right for everyone. There are great reason for applying for a reverse mortgage, but are you a candidate for the venture?
Current Home
If your home is paid in full and you have your bills under control you may not need the reverse mortgage. With bills paid in full and a reasonable income from social security or retirement you can enjoy your life without incurring another loan to be paid in the future.
New Homes
If you have recently bought a new home and have not developed equity a reverse mortgage would not be a benefit to you. You need to build a decent equity in your home before you even qualify. Without that the loan would be a waste of fees paid to apply just to be declined or receiving a loan no larger than the fees you paid.
Legal Issues
If there are liens against your home for unpaid bills or legal losses you are not a candidate for a reverse mortgage. You cannot have any legal issues regarding the sale of your home that will be paid before any loans against the home.
Primary Resident
If you plan to move soon, sale your home or move in with a child due to medical concerns you will not be a good candidate for a reverse mortgage. You must live in the home and maintain it as your primary residence in order to receive a reverse mortgage. Once you leave the home and no longer live there the loan will become due in full and have to be paid at that time.
Check with your local bank if you have any questions regarding a reverse mortgage. Don’t get yourself in debt if the debt is going to come due at a time when you are not able to pay it off. So be careful to make a wise choice when you consider a reverse mortgage.
Related posts: