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    • Reverse Mortgage Disadvantages and Advantages: Your Guide ...
      • Reverse Mortgage Disadvantages. High Fees: The upfront fees (closing and insurance costs and origination fees) for a Reverse Mortgage are considered by many to be somewhat high – marginally higher than the costs charged for refinancing for example.
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  2. Reverse Mortgage Disadvantages Guide (2020 Update) › advantages-disadvantages
    • Overview
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    A reverse mortgage is a home loan that allows you to access a portion of your available home equity and use the proceeds, which may be tax-free (not intended to be tax advice, please consult a tax advisor, payment of property taxes is still required), for the things you need. With this type of loan, no monthly mortgage payment is required for as long as you continue to live in the home or until a maturity event occurs.

    Costs for reverse mortgage products include origination and processing fees, third-party closing costs (just like a first mortgage) and possibly a monthly servicing fee and mortgage insurance premium. Many of these costs can be financed with the loan, and may vary depending upon which product you select. There is also counseling required for which you may have to pay a fee.

    Your loan remains active as long as you live in the home as your primary residence, retain the title to your property, and do not reside elsewhere for 12 consecutive months. You must maintain your home in good condition and continue to pay ongoing property insurance premiums and all applicable property taxes or assessments, including homeowners association charges. In the event these and other conditions are not met, it may cause your loan to become due and payable in full.

    When the loan hits a maturity event (none of the original borrowers still live in the home or other default), the loan becomes due and payable. At this time your heirs have the option to sell the home, pay off the loan and keep the home or choose to walk away. The loan is non-recourse so the lender can never look to other assets to repay the loan.

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  3. 5 Signs a Reverse Mortgage Is a Bad Idea › mortgage › reverse-mortgage
    • Your Heirs' Inheritance. When homeowners die, their spouses or their estates would customarily repay the loan. According to the Federal Trade Commission, this often entails selling the house in order to generate the needed cash.
    • You Live With Someone. If you have friends, relatives, or roommates living with you who are not on the loan paperwork, they could conceivably land on the street after your death.
    • You Have Medical Bills. Seniors plagued with health issues may obtain reverse mortgages as a way to raise cash for medical bills. However, they must be healthy enough to continue dwelling within the home.
    • You Might Move Soon. If you’re contemplating moving for health concerns or other reasons, a reverse mortgage is probably unwise because in the short-run, steep up-front costs make such loans economically impractical.
  4. Reverse Mortgage Disadvantages | Drawbacks and Cons of ... › reverse-mortgage

    In addition, borrowers must meet specific requirements as well: Be 62 years of age or older. Own the property outright or paid-down a considerable amount. Occupy the property as your principal residence. Not be delinquent on any federal debt. Participate in a consumer information session given by a ...

  5. Downsides of a Reverse Mortgage › blog › downsides-reverse-mortgage

    Oct 08, 2019 · While reverse mortgage loans may come with some disadvantages, in the right situation they can be a valuable tool for seniors looking to access their home equity without selling or making monthly payments. 1,2 Are you considering a reverse mortgage? Call 800.976.6211 to speak with a licensed loan advisor to discover your options.

  6. 6 Reverse Mortgage Disadvantages & How to Avoid Them ... › 6-reverse-mortgage

    Dec 19, 2019 · A reverse mortgage can cause complications for some borrowers who need long-term care. Many borrowers who take out a reverse mortgage intend to stay in their houses for the rest of their lives. But borrowers who reach a point where they need to move into a long-term care facility might have to sell their house before they want to.

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