St George Retirement Planning- Reverse Mortgages
Reverse Mortgages - Going Forward, not Backward
St George Utah Retirement Real Estate Expertise Implications for Utilizing Reverse Mortgages
- My buyer client can purchase an even nicer, or more suitable property than might otherwise be affordable. Affordable may also be defined as not wanting to pay payments, therefore only a house one has cash to pay for. So, keep in mind that a sizable down payment needs to be part of what equity is available to do a reverse mortgage off of. If you are in your 60's we can get you about 1/2 again on top of what your original down payment is to cash out the home and still have NO PAYMENTS TO MAKE. For example, if you thought in order to have no payments, you'd only be able to afford a home by paying all cash on a $150 home... well, now you could afford a home up to $300,000 and STILL HAVE NO DOWN PAYMENTS to ever have to make. Well, as to not try and be selling you something, two non "nuts and bolts" considerations would be: the total amount of cash you get from the loan; and the amount of equity you or your heirs get to keep at the end of the loan (see http://www.aarp.org/money/revmort/revmort_basics/a2003-03-21-totalcosts.html).
- Purchase a second property now, rather than later, using reverse mortgage funds from the current primary residence. Many a person would like to purchase here for retirement. Only thing is they come and look, but wait to buy till actual retirement. But wait!?! This way you can, buy here NOW, utilizing an equity line of credit off your current home as the down payment collateral from which to do a reverse mortgage, being able to afford an even nicer residence here sooner while prices are lower. Then wait till prices go up and then cash out your existing home when prices are higher and come here to retire in style. Buy when prices are low in one place and sell in the other when they are higher. NO PAYMENTS to worry or fuss over makes it possible.
Getting into the way actual amortization schedules work is tedious at best. The links provided above and below can delve you into the questions that cut to the chase involving how you compare options, which is crucial in this education. We all are paying more for our houses the conventional way, we recognize, like twice or three times over. Age benefits involving playing the insurance game of when people die, cashing in on the equity involved in our seniors homes, can offset the typical conventional loan requirements held in "MAKING PAYMENTS" to be made to suit only the working class.
This model of reverse mortgages has actually been around a long time with its historical origination roots guaranteeing the "principals" and "owners" of homes security, should the home be ascertained to be worth less than what was owed on it (if I heard right in my class). At least, we know that a prime benefit of a reverse mortgage is that if the home does not appreciate in value and the survivor in the reverse mortgage home continues to live, the longer they live, the sweeter the deal becomes for them with no payments and no interest compensation for the Lender in terms of appreciation. Reverse mortgages are "non-recourse" loans. The lender has no recourse except to the home. For more in depth information feel free to visit: http://www.aarp.org/money/revmort/
Steve Stout with SGI mortgage at 435-467-1090 has a good knowledge and one of the best margins on the interest rates and competitiveness on up front costs to offer. Give him a call for free counseling regarding them.