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Reverse Mortgages - What’s the catch?
Reverse Mortgages - What’s the catch? I hear that a lot, reverse mortgages sometimes sound too good to be true. ";You mean the bank will give me a loan that I don’t have to pay back until I die? Come on, really?  How do they make any money? There’s got to be more to the story!"; .... and there is. A Reverse Mortgage is a loan, period. It does have to be paid back, with interest and fees,  however the way in which the loan is set up can make it a good option for some senior homeowners.  Think about it like this - with a regular mortgage, say you borrow $100,000 at 5.5% against your home and every month you make a payment to them of $567.79. That includes principal and interest.  The majority of the monthly payment in the first half of a 30 year mortgage goes to interest as we all know, but you do see the balance of your loan going down every month when your statement comes in.  You might even complain to your spouse about how much of the payment went to interest and that your balance isn’t that much lower - but eventually after ... more

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