Reverse Mortgages Redondo Beach, CA
Have you been considering a reverse mortgage in Redondo Beach?
Some Loan Officers and Bankers will tell you to "just go do a Home Equity Line of Credit" instead of getting a Reverse Mortgage. Is that really a good strategy for someone on a fixed income?
Personally, I don't think it is. In my area of Redondo Beach, CA I'm seeing the result of a lot of people who took a Home Equity Line of Credit instead of a Reverse Mortgage.
Before the financial crisis knocked the wind out of most people's investments the banks were encouraging their clients to take a line of credit in case of emergency. It sounded like a good idea, right? Most people don't know that when the economy fell apart that the first thing banks did was call for the repayment of most Home Equity Lines of Credit or HELOC's, as they're known in my world. If you had one, more than likely you got a letter from the bank saying they to pay off your outstanding debt immediately. As the name suggests, the loan is tied to your home. If you couldn't pay it off, your home went into foreclosure.
A lot of seniors didn't realize that their monthly social security was used to qualify them-to show the bank they could repay the loan. They told their senior borrower "You qualify" and most people didn't question that. They were too happy to hear that they would get the money. But those seniors had already allocated social security funds for necessary items like food, prescriptions, heating and cooling. To add a huge loan payment to that simply wouldn't work.
Depending on the debt involved, that HELOC may have encumbered their properties too much to be able to do a reverse mortgage which might ordinarily pay off that loan. That's why it's important for you to learn how these products really compare before you make any decisions.
Had those same folks gotten the facts on a reverse mortgage BEFORE they signed up for that HELOC, it's quite possible they'd still be in their homes. With a reverse mortgage you don't repay the loan until you move, sell or permanently vacate your home. There's no income requirement and no credit requirement. You only need to be 62 or older and have enough equity in your home. You should also know that whatever money remains in your Reverse Mortgage Line of Credit will accrue a little bit of interest.
If you or someone you know is considering a Reverse Mortgage in Redondo Beach or anywhere in Los Angeles, Riverside, or San Diego Counties, feel free to give me a call so I can answer any questions you may have.
Warm regards,
Colette A Gray, Senior Loan Officer & Reverse Mortgage Specialist
(310) 405-1703
email me at cgray@ColetteAGray.com
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