Comments on: How Much Does a Reverse Mortgage Cost? http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/ A personal finance blog dedicated to discussing such topics as budgeting, asset allocation, 401K, IRA, cash flow, insurance, financial planning, portfolio management, and other areas in personal finance. Sat, 11 Feb 2012 20:32:19 +0000 hourly 1 http://wordpress.org/?v= By: Emily http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-446077 Emily Sat, 09 Oct 2010 18:38:53 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-446077 Keith in number 8 above asks if one should decide to pay back the reverse mortgage loan in a few years what will be owed? That is my question too. After the initial up front fees what are the on going monthly of annual fees? I under stand there is the monthly $30 to $35 service fee, but what else? I assume the what else includes some interest, in what typical range? Anything else? Keith in number 8 above asks if one should decide to pay back the reverse mortgage loan in a few years what will be owed? That is my question too. After the initial up front fees what are the on going monthly of annual fees? I under stand there is the monthly $30 to $35 service fee, but what else? I assume the what else includes some interest, in what typical range? Anything else?

]]> By: Cliff http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-443008 Cliff Sat, 27 Mar 2010 01:47:25 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-443008 You can also grow your equity should your home appreciate in value which is likely as the market turns around. When the house is sold, you must pay the revese balance but you get to keep the equity ovwer that amount.It actually cam work in your favor with interest rates where they are today, around 5.5%. You can also grow your equity should your home appreciate in value which is likely as the market turns around. When the house is sold, you must pay the revese balance but you get to keep the equity ovwer that amount.It actually cam work in your favor with interest rates where they are today, around 5.5%.

]]> By: John http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-415769 John Mon, 20 Apr 2009 14:49:03 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-415769 Dawn, As H L Mencken said "For every complex problem there is an answer that is clear, simple, and wrong." My house is paid for. I have nobody to whom I want to give it. My retirement income has been dramatically reduced by the current market downturn. I can get some additional monthly income by using a reverse mortgage. Said monthly income will improve the quality of my life. What is wrong with my reasoning? Where am I being fleeced? Where is the crime in my case? Dawn,

As H L Mencken said “For every complex problem there is an answer that is clear, simple, and wrong.”

My house is paid for.

I have nobody to whom I want to give it.

My retirement income has been dramatically reduced by the current market downturn.

I can get some additional monthly income by using a reverse mortgage. Said monthly income will improve the quality of my life.

What is wrong with my reasoning?

Where am I being fleeced?

Where is the crime in my case?

]]> By: Faith http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-399172 Faith Mon, 26 Jan 2009 22:31:03 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-399172 I might have my mother do this as she is being sued for huge credit card debt. So I see the reverse mortgage as being possibly the lesser of 2 evils - allow the creditor to take the home in a judgment amount that grows until the home is sold OR get a reverse mortgage and pay the creditors off for peace of mind. The home equity is lost either way, but I don't want the predatory lenders to get everything! I might have my mother do this as she is being sued for huge credit card debt. So I see the reverse mortgage as being possibly the lesser of 2 evils – allow the creditor to take the home in a judgment amount that grows until the home is sold OR get a reverse mortgage and pay the creditors off for peace of mind. The home equity is lost either way, but I don’t want the predatory lenders to get everything!

]]> By: dawn http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-376866 dawn Thu, 06 Nov 2008 17:50:49 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-376866 Reverse Mortages are wrong, wrong, just plain oh wrong. People who sale reverse mortages to our senior citizens are fleeing them and it's a crime shame. Why would you encourage senior citizens to put their paid for home or near paid for home at risk, then sugar coat it. God have mercy on you. Reverse Mortages are wrong, wrong, just plain oh wrong. People who sale reverse mortages to our senior citizens are fleeing them and it’s a crime shame. Why would you encourage senior citizens to put their paid for home or near paid for home at risk, then sugar coat it. God have mercy on you.

]]> By: Keith Howell http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-285521 Keith Howell Thu, 17 Apr 2008 01:07:31 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-285521 None of these sites seem to address the costs I am looking for. 1. I would like a reverse mortgage based on how much I owe the current lender, not how much I can borrow. 2. If I chose to sell the house after x years, how much would I need to repay the lender. Obviously the initial amount plus, presumably, $y for every month the reverse mortgage was in effect. But what is y? None of these sites seem to address the costs I am looking for.
1. I would like a reverse mortgage based on how much I owe the current lender, not how much I can borrow.
2. If I chose to sell the house after x years, how much would I need to repay the lender. Obviously the initial amount plus, presumably, $y for every month the reverse mortgage was in effect. But what is y?

]]> By: Larry Morris http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-249745 Larry Morris Mon, 10 Mar 2008 14:17:38 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-249745 THe service set-aside covers the monthly serivice fee for a set period. This fee is usually $30-$35 per month. Since it is a Senior Loan, all fees are disclosed and broken out. A traditional loan has servicing fees, but they are added to the interest rate. Not so with a Reverse Mortgage. This money goes into an escrow account and is subtracted each month to pay the servicing company. If the senior sells, any funds left are refunded. The mortgage insurance also protects the heirs and estate of the senior, as well as the bank. On a traditional mortgage, when the last survivor on the loan dies, the note is due. If there is a balance, it becomes a debt to the estate. Not so with a Reverse Mortgage. The non recourse feature prohibits the lender from coming after the estate. THe service set-aside covers the monthly serivice fee for a set period. This fee is usually $30-$35 per month. Since it is a Senior Loan, all fees are disclosed and broken out. A traditional loan has servicing fees, but they are added to the interest rate. Not so with a Reverse Mortgage. This money goes into an escrow account and is subtracted each month to pay the servicing company. If the senior sells, any funds left are refunded.

The mortgage insurance also protects the heirs and estate of the senior, as well as the bank. On a traditional mortgage, when the last survivor on the loan dies, the note is due. If there is a balance, it becomes a debt to the estate. Not so with a Reverse Mortgage. The non recourse feature prohibits the lender from coming after the estate.

]]> By: Lord http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-234579 Lord Fri, 15 Feb 2008 00:14:10 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-234579 Also, though your credit line goes up, so should the value of your home (at least in normal times). Also, though your credit line goes up, so should the value of your home (at least in normal times).

]]> By: Lord http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-234577 Lord Fri, 15 Feb 2008 00:11:38 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-234577 While the service set-aside may not be charged up front, I believe it is billed as part of the monthly payment to handle the adjustable interest rate calculations and loan processing. While the service set-aside may not be charged up front, I believe it is billed as part of the monthly payment to handle the adjustable interest rate calculations and loan processing.

]]> By: JLP http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/comment-page-1/#comment-234363 JLP Thu, 14 Feb 2008 17:50:34 +0000 http://allfinancialmatters.com/2008/02/13/how-much-does-a-reverse-mortgage-cost/#comment-234363 This is a comment from Corey at <a>ForwardbyReverse.com</a>. For some reason he can't post comments on this blog. <em>Hello Charles. Allow me to respond to your good questions. Selling the home is always an option a senior has. I don't think anyone would tell you otherwise. The reason most seniors choose a reverse mortgage over selling is because they would rather remain in their home. They have an emotional investment in it, even more than a financial one. In every corner of the home, there is a memory. They are not necessarily looking for the best business decision, but the best personal decision. Your scenario about a home being too big or too many levels is not always true. Sure, it can be. But believe me, a senior of sound mind knows their limitations. If they can't navigate their home, they will move. Remember, anyone who is "pro" reverse mortgage only talks about it as an option. At least, that should be their approach. Seniors should be aware of all their options. Not just the ones which make sense to you. Even if it's not right for you, it's a godsend to more and more people every single year. You should be glad it exists, even if you never need one yourself.</em> This is a comment from Corey at ForwardbyReverse.com. For some reason he can’t post comments on this blog.

Hello Charles.

Allow me to respond to your good questions. Selling the home is always an option a senior has. I don’t think anyone would tell you otherwise. The reason most seniors choose a reverse mortgage over selling is because they would rather remain in their home. They have an emotional investment in it, even more than a financial one. In every corner of the home, there is a memory. They are not necessarily looking for the best business decision, but the best personal decision.

Your scenario about a home being too big or too many levels is not always true. Sure, it can be. But believe me, a senior of sound mind knows their limitations. If they can’t navigate their home, they will move.

Remember, anyone who is “pro” reverse mortgage only talks about it as an option. At least, that should be their approach. Seniors should be aware of all their options. Not just the ones which make sense to you. Even if it’s not right for you, it’s a godsend to more and more people every single year. You should be glad it exists, even if you never need one yourself.

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