Reverse Mortgage
- Thread starter crossnote
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...anyone here have had an experience (bad or good) with a Reverse Mortgage, whether you had one in the past or are a financial broker?
my grandmother did this -- my mother says she was sort of railroaded into it by my uncles; she didn't agree with it. it provided money for her to get the care she needs (she has alzheimer's) but also meant that her house was no longer hers; we moved her later, and at that time she could have sold her home for more than what the reverse mortgage provided, so there was a 'loss' -- it's a tradeoff you should consider; you get financial help now, but it comes at a cost. if the immediate need is great enough, or you don't want to leave property to anyone, it's not a bad idea - but keep in mind that banks intend to make a profit from it; i think that more often than not you won't receive full market value - so there may be better options, if you have time or resources to pursue them. for some situations this is a great option, but not for every situation.
I don't understand why the home was no longer hers. My understanding is that the title deed remains in her name, it's just that when she goes to sell it she has higher fees, interest etc., to pay...or was it no longer hers because of the alzheimer's?
i might have some details mixed up, and reverse mortgage policy has probably changed - this happened about 20 years ago - but if i remember right, the bank's lien against the house + interest meant that they handled the sale of the house and took all the profit. the deed was still in her name, but all the equity belonged to the bank.