If you’re a senior age 62 or older, and you’re looking for a way to boost your retirement finances, you’ve probably been considering a reverse mortgage. Sorting through reverse mortgage pros and cons can be a bit tricky, so we’ve laid some out for you here.
Reverse mortgage pros: What are the benefits of reverse mortgages?
For the right senior in the right situation, a reverse mortgage can create the opportunity for a much nicer lifestyle during retirement with the supplemental funds, which allows for the pros to outweigh some of the cons.
Some of the pros and benefits of reverse mortgages:
- Staying in the home - When considering reverse mortgage pros and cons, you have to look at overall quality of life. A reverse mortgage will allow you to keep the title of your home and continue to live there while having more spending money for daily life. It’s hard to ignore that benefit. In fact, one of the requirements is that the borrowers occupy the property as their principal residence.
- Varied disbursement options - There are a number of different ways to set up a reverse mortgage loan disbursement payments from which the borrower may choose. This makes it easy to set the reverse mortgage up in a way that will work for you.
- A better retirement - It probably goes without saying, but the biggest positive of a reverse mortgage is that you will gain the supplemental money you need for retirement. A reverse mortgage can provide you with additional monthly income to live a much more enjoyable life. Isn’t that what retirement is all about?
Reverse mortgage cons: are there any negatives of a reverse mortgage?
One of the potential negatives is that lots of people sign up for a reverse mortgages without having a strong grasp of how it all works. You can address this concern by ensuring you are well educated on the terms and rules of your reverse mortgage.
Furthermore, the loan becomes due and payable after the borrower permanently moves out of the home, stops using the property as the principal residence, sells the home or the last surviving borrower dies. The loan also becomes due if you stop paying your property charges, such as taxes, homeowners’ insurance or fail to maintain the property in good repair.
Another area to investigate is that the reverse mortgage could potentially affect other areas of your life. For example, the boost in income might remove your ability to qualify for income-based government benefit.
Contact Quontic Bank to learn more about reverse mortgage pros and cons
For more information about reverse mortgage pros and cons, please contact Quontic Bank at 1-800-388-7689 today.
Quontic Bank is a Member FDIC bank, federally regulated by the U.S. Office of the Comptroller of the Currency. We have an A+ rating from the Better Business Bureau and were named to the Top 200 Healthiest Banks In America in 2016, ranking No. 88 of the 6,199 federally insured banks in the U.S., according to DepositAccounts.com, a website that monitors and informs consumers of how well financial institutions perform. We were also ranked the 12th largest reverse mortgage lender in the U.S. by "Reverse Mortgage Daily," a reverse mortgage news website.