Reverse mortgages may have been considered products of last resort, but they can make financial sense for the right borrowers who need them, according to a recent article from Houston’s Chron.com.
Whereas in the past reverse mortgages have come under fire for perceivably high fees and instances of borrowers spending down their home equity too quickly, several regulations in recent years have served to make the product safer for consumers, notes the article.
However, it is still largely up to consumers to know exactly what they are getting into, says Bruce McClary, spokesman for Washington, D.C.-based nonprofit National Foundation for Credit Counseling.
“There is a place for reverse mortgages under certain circumstances,” McClary said in the article. “Not all offers are the same. Some seniors need to look at the details and ask a lot of questions.”
The article also features input from One Reverse Mortgage President and Chief Operating Officer Gregg Smith, and National Reverse Mortgage Lenders Association President and CEO Peter Bell, who each discuss certain eligibility qualifications for reverse mortgages.
When it comes to driving people into the decision to get a reverse mortgage, motivation is a factor.
“There are many reasons people would tap the equity in their home through a reverse mortgage, but if it’s for daily survival, there may be better options,” Chron.com states.
Read the Chron.com article.
Written by Jason Oliva