Reverse mortgages a good move for many, not all, seniors
I work for a Christian-based company that educates senior homeowners about the Home Equity Conversion Mortgage (HECM), popularly known as reverse mortgage. The truth of the matter is that it is not meant for all seniors. If the senior plans to move within two to three years, it would, in most cases, not be financially beneficial. It is meant for seniors who have worked hard to keep their homes up and plan to live in them for the duration of their lives. The reverse mortgage allows the senior to actually access a portion of the equity in their homes while they’re here to enjoy it in any fashion they chose. Negative articles in the past have nothing to do with the actual process initiated during the Reagan years. Bad publicity was created when lenders who initiated the program influenced seniors to invest program equity after the fact, which resulted in a holding period where the senior couldn’t get at much-needed money. Most [seniors] use the money to either pay off higher rate mortgages, liens, debts, taxes, etc. and/or to make their remaining years less stressful and more enjoyable. Another misconception is that the government and/or bank becomes owner of the house. The truth is that the deed remains in the senior’s name and, when [they die], the house goes solely to whomever the senior designates. This party then has a year to either refinance the cost and value of what was used from the program and move into the house or to sell it, keeping the unused program cost and equity. So the heir will always have a benefi t. Before you listen to the scuttlebutt about reverse mortgages, please get the cold facts. JOE KRISS Clifton Park The writer is with Best Interest Mortgage Corp.
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