What the heck is a "reverse mortgage"?

[AMDZen]

I won't say its a scam, but its a raw deal for most people and even for those that its not a bad deal for - its still a much better deal for the bank.

Then again what isn't.

 

[MixMasterTang]

Originally posted by: AmigaMan

Originally posted by: Mwilding
It's your money, use it when YOU need it!

damn I hate that commercial.
RANT: "If you were frickin responsible to begin with you would have your money and someone wouldn't have to manage it for you idiot! But you are too stupid and would lose all of your settlement/whatever money on hookers and blow so we have to handhold your simple-minded ass and manage it for you. But if you want to pay some lawyers a hugeass fee to sue us, then we'll oblige and let you have your money, but don't come crying to us in two weeks when you're out on the streets wondering where your money is, ass."

Not that what you are saying isn't true about SOME people, but what about someone who was in a bad accident, cannot work and has a ton of medical bills and they were awarded a settlement for their accident to where they get $20,000 a year for the next 50 years (or something like that). Do you think those people have not been responsible and will blow all of their money on hookers and blow?

 

[Beattie]

It's not a scam, but it's generally a bad idea. If you want money in exchange for your house, take out another mortgage.

 

[alkemyst]

Originally posted by: her209
Seems like they would fair better just selling the dang thing.

because they can just live in a box somewhere right?

 

[Epic Fail]

inherit grandma's house or have her move in with you...

 

[runzwithsizorz]

Originally posted by: Beattie
It's not a scam, but it's generally a bad idea. If you want money in exchange for your house, take out another mortgage.

And repay it with what? Maybe their social security, and pension is only about $1800 a month.
$150.000 home equity loan, payments = ? , oh look granny, theres enough money left over to finally go on that cruise.

 

[Whoozyerdaddy]

Originally posted by: Beattie
It's not a scam, but it's generally a bad idea. If you want money in exchange for your house, take out another mortgage.

I don't think you understand how a RM works... The idea is to receive income, not accrue more debt. It's not for everyone but in most cases it's better than taking out a mortgage.

 

[sandorski]

Originally posted by: runzwithsizorz

Originally posted by: Beattie
It's not a scam, but it's generally a bad idea. If you want money in exchange for your house, take out another mortgage.

And repay it with what? Maybe their social security, and pension is only about $1800 a month.
$150.000 home equity loan, payments = ? , oh look granny, theres enough money left over to finally go on that cruise.

You don't need to repay it. If you live beyond the Payout, you can still live in the house as long as you're Alive.

 

[FoBoT]

not new, not a scam

 

[MaxDepth]

Actually, it started out as a way for the children of parents, who own a home, to provide income to their parents and retain the house. Basically, it is a way for avoiding taxes by the children after the death of their parents.

The children, not a bank or some other lending institution, make the payments.

 

[RaiderJ]

Originally posted by: Greenman
It is legit. A lot of older people have very little income, no savings, and a ton of equity. A reverse mortgage allows them to stay in their home and live a good life off of the equity. It's not like they can take the money with them.

Exactly.

 

[spidey07]

But the terms seem way too variable. Why not get a fixed interest rate HELOC or 2nd mortgage, invest it and live off that?

 

[waggy]

Originally posted by: Beattie
It's not a scam, but it's generally a bad idea. If you want money in exchange for your house, take out another mortgage.

hahahahahahhah talk about missing the point.

 

[Acanthus]

Not a scam.

 

[waggy]

Originally posted by: spidey07
But the terms seem way too variable. Why not get a fixed interest rate HELOC or 2nd mortgage, invest it and live off that?

because you still have to pay off the heloc and 2nd mortgage? even with investing it won't work.


this way you get paid a monthly payment. for some its good (though i have other problems with it).

 

[alkemyst]

Originally posted by: spidey07
But the terms seem way too variable. Why not get a fixed interest rate HELOC or 2nd mortgage, invest it and live off that?

investing is doing really well right now for many .

A reverse mortgage is a guaranteed payment. It's like bonds vs stocks.

 

[NanoStuff]

The best thing to do is sign up for both a mortgage and reverse mortgage at the same time. This way you get a house without ever paying for it, the two cancel out.

 

[Slew Foot]

Cant sign up for the reverse if you dont have equity.