Reverse Mortgage...Good or Bad

By
Real Estate Agent with Northwood Realty Services

A few weeks ago I had a buyer ask me about my knowledge of reverse mortgages. Since I have had little to know experience in dealing with these I sent him to the Internet and several of my contacts mortgage field.

Then just today my co-worker brings me this article, Make Your House Work, about reverse mortgages in the January-February 2008 AARP Bulletin. The article was very informative and sparked some great discussion between us, but left us both wondering about these instruments. Neither of us are familiar with the details and best uses for these, so that is the reason for this post.

I'd just like some feedback from anyone out there done these? How or could they be beneficial to my buyers or seller? What are your experiences with them? Are these becoming more popular? Just any personal experiences you may want to share!

Thank you,

Joslyn Dermer, ABR

Comments (4)

Joyce Windschitl Hercules
Prime Mortgage - Chanhassen, MN
MN, FL, WI & CO Mortgage Consultant
Just as in any loan program, it depends upon the client.  Reverse mortgages have their purpose.  Personally, I think they will become more popular with the baby boomer generation sooner than later.  The key to this program is the same for any program - does the client fully understand what the program is and how it works?  It is prudent that we use full disclosure with these programs and set people up for success.  And, I have found that in certain situations, family is involved so they understand what mom and/or dad is doing.  Yes, they can be beneficial for the right client.
Jan 22, 2008 02:33 AM
Kevin Weaver
MCS Mortgage Bankers - Cincinnati, OH
an experienced mortgage professional NMLS #457556

Reverse mortgages are definitely becoming more popular.  Our office has closed a few in recent months.  One of the key benefits to help a senior homeowner is its flexibility.  They can have a monthly draw of an amount they choose or take a lump sum. In my opinion, the "HECM" reverse offered by HUD-approved lenders through FHA is the superior option to the Homekeeper program.  A key thing to remember is that no one under age 62 may remain on title to the property and the homeowner does need to have equity in the home.  The funds available will be relative to the amount of equity and the age of the homeowner.

It is a good product as long as it is used properly and explained thoroughly.  All seniors who apply for a reverse mortgage will be provided counseling either in person or by phone reagrding their available options.

Jan 22, 2008 02:41 AM
Joslyn Dermer
Northwood Realty Services - Somerset, PA
Associate Broker, ABR
Joyce & Kevin - Thank you for the feedback, I do appreciate it. www.myrealtorjoslyn.com
Jan 22, 2008 12:52 PM
Roland Woodworth
eXp Realty - Clarksville, TN
eXp Realty

Hey Jos.. I see this can go both ways.. Can be both negative and positive...

May 16, 2009 06:06 PM

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