Reverse mortgages may be safer loans now than they ever have been in the past, but certain pitfalls remain, says a recent article from the Detroit Free Press.
While the article acknowledges the tighter borrowing limits and stricter financial requirements that have occurred over the past year, the Detroit Free Press points to a “sticky subgroup of foreclosures” involving reverse mortgages across Detroit and the U.S.
“In Detroit, ‘the biggest problem we’re seeing with mortgages is the reverse mortgage problem,’ said Ted Phillips, executive director of the non-profit United Community Housing Network, which battles on behalf of homeowners facing foreclosure,” the article states.
The Housing Network, along with its staff of of lawyers and advisors, helped to keep nearly 2,000 homes occupied by Detroit homeowners from being lost to foreclosure in 2015.
“After a borrower receives what fees like a windfall of free money from a reverse mortgage lender, ‘they still have to keep the taxes current, still have to maintain the house, and still have to pay the insurance, which is often off the charts in Detroit,'” the article attributes to Phillips.
Read the Detroit Free Press article.
Written by Jason Oliva