How to Avoid Reverse Mortgage Pitfalls
What you Must Know About Reverse Mortgages
Reverse Mortgage advertising has been targeting the 10,000+ baby boomers retiring every day. A retirement trend that is slated to continue until the nearly 80 million baby boomers leave the work force. What Reverse Mortgage proponents know is that baby boomers will probably need additional income to stay afloat during their retirement years.
It is critical that anyone looking at a Reverse Mortgage understand the Pitfalls that could literally take their home and security away. Here is a list of some of the pitfalls:
- If you leave your home for 1 year, they can require that the money be repaid immediately – or “call the loan”. It doesn’t matter if you are on an extended vacation or in a nursing rehab center. If you are gone for 1 year, they can call the loan.
- You must keep your home in good repair and fix any damage within a reasonable period of time. If there is a natural disaster that damages the home, if you don’t fix it, they can call the loan.
- You must pay for and keep current real estate taxes and insurance. If you are use to having your taxes and insurance paid by the lender, that will not be the case with a Reverse Mortgage.
- You will not get paid the full value of your property.