Is A Reverse Mortgage Right For You?

Reverse Mortgages seem to be getting a lot of play in the media these days. Robert Wagner lends a lot of creditability and does a masterful job as front man for the Senior Lending Network who, on request, will send you out a rather seductive cd telling all about the product and people who have taken out reverse mortgages.

The reverse mortgage, sometimes called a Lifetime Mortgage or Home Equity Conversion Mortgage (HECM), was created some years ago by the Federal Housing Authority (FHA) for seniors 62 years or older. The loan is rather unique because it will allow an owner to convert a portion of the equity of the home into tax-free cash which can then be taken in one lump payment or in monthly payments for a period of time or for life.

The money derived from a reverse mortgage has no restrictions and can be used for virtually anything, supplementing income, home improvements or anything else. The good news is that the borrower has no monthly payments and their only responsibility is to pay property taxes, homeowner's insurance and maintenance on the property. The loan becomes due when the homeowner either dies, moves to a care facility or the property is sold.

So the question becomes, if you qualify, is this the right type of product for you. The answer lies in a lot of due diligence, because despite the sexiness of mortgage, there are a lot of questions that you need to address not the least of which are the costs!