“Read the fine print,” advises Jennifer Lane, certified financial planner, in an interview with New England Cable News this week on the topic of reverse mortgages. “That’s why a lot of financial planners tell people to stay away from reverse mortgages.”
Lane cites high closing costs as something borrowers should look out for, but says the loans have the potential to become more commonplace.
“We’re all expecting things to happen over time that will make [reverse mortgages] more attractive for people,” she said.
The segment notes the “new” Saver product and its lower fees and also discusses reverse mortgage alternatives such as a home equity line of credit or selling the home.
Lane also touches on the issue of non-borrowing spouses of reverse mortgage holders, but doesn’t seem to present the whole picture.
“Be very careful, because some older reverse mortgages are written so surviving spouses could have a problem,” she says. The topic of non-borrowing spouses has been brought up in two recent lawsuits filed by AARP. The timing of those mortgages being written, however, is not the contested issue in the one outstanding lawsuit.
Written by Elizabeth Ecker