Reverse mortgages getting better
But costs, scams mean seniors still need to be on guard
Question: My aunt is in a similar position as the 91-year-old woman with an oceanfront house in Southern California. It was suggested to us that she use a reverse mortgage. What are the cons to a reverse mortgage?
Answer: There are a couple that come to mind. For one thing, the fees are expensive, not just to originate the loan but also to administer it. But they are coming down as competition among lenders heats up.
For another thing, a few scam artists seem to have found the sector and are pushing inappropriate loans on unsuspecting borrowers. But that, too, shall pass as the businesses’ standard bearers work to weed out the rascals who foisted so many subprime loans on the masses.
Still, with some 40 million Americans already 62 years of age or older, and with 79 million Baby Boomers heading into the senior years, the potential for reverse mortgages is bright. “This is a vastly underserved market,” says Bart Johnson, co-chair of the National Reverse Mortgage Lenders Association. “The unmet needs are huge.”
Post from: Reverse Mortgage Loan Blog
