On Sunday, August 31, 2014 1:13:02 AM UTC-4, micky wrote:
On Sun, 31 Aug 2014 00:40:45 +0200, nestork

wrote:





'Bob[_66_ Wrote:

;3278158']

Never give up control of something you own. Run away as fast as you can.



That's exactly why I don't like these "reverse mortgages" you hear

advertised on TV. Basically, you sell half of your house back to the

reverse mortgage company for whatever the price is NOW. Then 20 years

from now, when you pass away, your estate only collects half of what the

house sells for. The reverse mortgage company you deal with pockets the

other half.



I see your point, but what if your income from pension etc. is

inadequate to meet your needs, and the only asset you haven't sold is

your house and your car, and you don't want to move.


Then it depends on the extent of the inadequacy, how much equity you
have in the house, and how long you expect to live and actually will
live.




I know, at least I'm told, it's expensive compared to what one gets just

selling his house, And I expect they give you a monthly check which

never goes up while inflation raises other prices.



Wouldn't it be better to find out what they actually are, instead of
speculating? They can be lump sum or more typically they are line of
credit type, where you can draw whatever you want.




But what is better for someone who doesn't want to move?.



The only alternative I can see is to try to get a regular mortgage,

probably hard to do when your income is too low for you to live on. But

if you could get the mortgage, say 100,000, and you put 50,000 away to

make mortgage payments with, you'd only have half the money also.

You'd also be actually paying interest on $100,000 from day one, instead of
accruing interest on maybe $1000 in the beginning of the reverse mortgage.
Which would you rather pay interest on?


Then

every month you'd make the payment and the amount you owed would go

down, and if you lived 15, or 20 or 30 years longer (depending on the

term of the mortgage) you'd own the house again completely. And you'd

die with a 120,000 asset, while living short of money all those years.


If you could pay for a new mortgage, you probably wouldn't need the
new mortgage. For many of these people, the point is to not die with
a $120,000 asset.





With a reverse mortgage, you die with nothing, because yo've spent it

all, but you don't have to worry about running out of money as long as

you're living, because the mortgagee (plus your pension and social

security) pays you as long as you live.



You typically don't die with nothing, just substantially less. Whatever
equity is left in the house is still yours. The mortgage apparently only
continues to pay if that's the type you selected. A one time, lump
sum one won;t.





I really want you're counter arguments.



I think I have enough money to last me for the rest of my life if I

spend down the principal too, but the problem is I don't know how long

I'll live.



I don't want to run out of money early-- that would be horrible -- , and

I don't want to live a scrimping life and then leave too much to my

niece, nephew, and charities.



Seems like that's the reason some folks choose a reverse mortgage.