Reverse mortgages are getting more popular and they are “getting better,” writes Certified Financial Planner Dee Lee in a CBS News Boston column this week.
Covering reverse mortgage basics, the column includes an sample calculation of how much a 62+ home owner may be able to borrow. The loans are not for everyone, Lee says, and she does not recommend considering a reverse mortgage for people who are close to age 62.
The column writes:
These mortgages are not for everyone. Who should consider one? A cash strapped elder who wants to stay in their home! An individual who is on a fixed income and living in their own home and wants to stay in their home may find a reverse mortgage gives them the cash they may need to maintain their lifestyle, but more importantly may give them the cash they need to make repairs or modifications on the house so they can continue to live there.
There are no restrictions on how the money is used. Which worries me for many retirees are getting a reverse mortgage and going on a shopping spree, traveling with the money, or helping their kids get out of debt.
To be eligible for a reverse mortgage you must be at least 62-years-old and own your home although you can still have a mortgage. But should you be considering a reverse mortgage when you are 62? I don’t think so, unless there some extenuating circumstances….
Read the original column.
Written by Elizabeth Ecker
