On 2019-09-25 1:58 p.m., dpb wrote:
On 9/25/2019 2:18 PM, Ed Pawlowski wrote:
On 9/25/2019 11:57 AM, Ralph Mowery wrote:
In article ,
says...

**I considered it for a while and the thing he denies was the advantage
of a reverse mortgage. Instead of having a house that no one wanted in
my estate, there would either be money that everyone wants, or money I
would have already spent.Â*Â*Â* (I considered an annuity too, but then I'd
still be dead and stuck with a house.Â* It's very hard to fix up your
house for sale, and to sell it, when you're dead.)



I have not really looked into the reverse morgage.Â* It might be a great
thing for the few that do not have children or others they want to leave
money to.


Reverse mortgage is good if you actually need the money and can live
better.

As for leaving money, I already gave my kids the ability to earn a
living.Â* If anything is left, good for them but they would rather I
enjoy life and spend as I see fit.

I know an older couple that had modest retirement income.Â* They had a
big expense for the septic system and took a reverse mortgage.Â* Took
care of that an a few other little things that made them more
comfortable.Â* They are gone and the house, AFAIK, was left to the
nurse that took care of her near the end.

They are made to sound good by the purveyors, but ever wonder what is in
it for them?Â* As with annuities what you get is an actuarially adjusted
amount based on the equity held in the property at the time and your
age.Â* Virtually always one would be far better off financially to just
sell the property on the open market, take the lump sum payout of the
equity and live in a less expensive location while investing part of the
proceeds.

Specific downsides include

- If youve not paid off your mortgage the interest on the reverse
mortgage loan compounds with the original interest and it can quickly
balloon out of control.

- Unlike a traditional home equity loan, you are not making payments on
the principle and interest. So while your heirs are not on the hook for
the loan, compound interest, fees, and fluctuations in the market can
increase the likelihood they will be unable to retain the home when you
are gone.

- You must remain there and continue to pay property taxes, maintenance
and insurance.Â* If you change your mind and want to move to FL or need
assisted living or any number of other potentially unforeseen
circumstances, if you break the covenant you lose the house and the
reverse mortgage cash flow besides.

Verdict:

Reverse mortgages may be a way to get financial relief if you have no
one to pass your house to when youre gone.Â* Otherwise, almost certainly
a bad idea and as noted, virtually always one could come out better by
simply selling the property straight out.

--

what will i care , i'm dead