Reverse Mortgages: The Good, The Bad and The Ugly February 26, 2017 Publisher Posted in FeaturedWealth Written by Silver Sage Magazine The Good: Allows the homeowner to stay in the home as long as you keep the loan in good standing and as long as you live (or can) in the home. You or your heirs will never owe more than the home is worth. Can pay off existing mortgages on the home. Easy to qualify for because generally no income requirements and no minimum credit score required. No monthly mortgage payments are required. The homeowner receives payments on flexible terms such as credit line, lump sum distribution, monthly payments or a combination. The interest rate may be lower than traditional mortgages and home equity loans. Loan proceeds are not taxable. If your heirs inherit the home, they may keep any remaining equity (after the balance of the reverse mortgage is paid off). The Bad: Fees on a reverse mortgage are higher than a conventional mortgage. Loan balance gets larger over time while the value of the estate/inheritance may decrease over time. Need-based government assistance (Medicaid) can be affected if a surplus of funds is withdrawn in a month. The program is often misunderstood. The Ugly: Can eat away at valuable home equity. If you need to move out to an assisted living facility, nursing home or the like; the loan becomes prematurely due. Risk of foreclosure if you don’t keep the house in good repair or fall behind on any payments (taxes and insurance). Related Posts 0 comments FeaturedLatest NewsRetirementWealth Social Security Benefit Rule Change Read more 0 comments CaregivingFamilyWealth Top 5 Things to Know About Aging Read more 0 comments FeaturedTaxesWealth New Tax Law’s Effect on You Read more Share this About author Publisher The publisher and Editor in Chief for Silver Sage Magazine writes from her heart on contemporary issues important to #silversagers. Related Posts 0 comments FeaturedLatest NewsRetirementWealth Social Security Benefit Rule Change Read more 0 comments CaregivingFamilyWealth Top 5 Things to Know About Aging Read more 0 comments FeaturedTaxesWealth New Tax Law’s Effect on You Read more 0 comments FeaturedTravelUS Kauai with Your Adult Children Read more Do not miss 0 comments FeaturedLatest NewsRetirementWealth Social Security Benefit Rule Change Read more