A daughter looking to pay off her mother’s reverse mortgage should take advantage of record low mortgage rates and buy the home before her mother dies, a Chicago Tribune columnist recommends.
The borrower’s daughter sought answers about staying in her mother’s home, which has a reverse mortgage, and paying off the loan over a period of time. This raised an interesting question, says the Tribune, because most reverse mortgage lenders are not positioned to take multiple or even monthly payments for these loans.
Instead of waiting to pay off the loan once the reverse mortgage borrower passes away, says the columnist, the daughter should consider “buying” the home from her mother now, before more interest accrues on the loan.
Because mortgage loan interest rates are so low, with 30-year mortgages available for just over 4%, and some 15-year loans for less than 3.5%, it would make sense to take one out and buy the home, allowing the mother to pay off the reverse mortgage that’s accruing interest at a higher rate.
Doing that, says the Chicago Tribune, would put her “way ahead of the game.”
Read the full article here.
Written by Alyssa Gerace