Reverse Mortgage: Scam or legit financial option?

[radcen]

Reverse Mortgage: Scam or legit financial option?

What say you?

 

[Lutherf]

In certain circumstances it's a good deal though it may not be the best option for everyone.

 

[Gipper]

It's a good deal if you hate your kids.

 

[iguanaman]

Reverse Mortgage: Scam or legit financial option?

What say you?

A Bank Scam, a HUGE bankers scam. My uncle got sold one of those on his death bed. He never collected one dime and it cost the estate $25,000 to get the lien off his house.

 

[specklebang]

Reverse Mortgage: Scam or legit financial option?

What say you?

No actual experience so pure surmise follows, untainted by any facts.

I think it's a decent option for the elderly who aren't planning to leave an estate. Money is useless when you're dead.

 

[iguanaman]

No actual experience so pure surmise follows, untainted by any facts.

I think it's a decent option for the elderly who aren't planning to leave an estate. Money is useless when you're dead.

Refinancing is a much better way of taking out equity. The fees and overhead are astronomical with a reverse mortgage. Just look who is selling them on TV if you doubt me.

 

[Gipper]

Refinancing is a much better way of taking out equity. The fees and overhead are astronomical with a reverse mortgage. Just look who is selling them on TV if you doubt me.

You callin Fred D. Thompson a liar?

 

[Helix]

when i see a celebrity pitching reverse mortgages, it lowers my opinion of them exponentially. tricking old people out of their money puts you among the lowest forms of scum.

 

[specklebang]

Refinancing is a much better way of taking out equity. The fees and overhead are astronomical with a reverse mortgage. Just look who is selling them on TV if you doubt me.

You dare to speak with the voice of experience and expect to win over my swinging wild assed guess?:roll:

I don't have a TV BTW and you just pointed out one of my reasons for eschewing this vapid form of entertainment.

 

[iguanaman]

You callin Fred D. Thompson a liar?

Technically no. If you listen, the commercial is very carefully worded to avoid claiming it is a good deal. They call it "effective" instead.

 

[lizzie]

They seem legit to me, but I can tell you that I sure as hell would not want one.

 

[Lutherf]

A Bank Scam, a HUGE bankers scam. My uncle got sold one of those on his death bed. He never collected one dime and it cost the estate $25,000 to get the lien off his house.

Signing a contract for a reverse on your deathbed is one of those "not such a good idea" situations.

The reverse is a fine idea for someone who wants to stay in their home but needs some additional income.

 

[Gipper]

Signing a contract for a reverse on your deathbed is one of those "not such a good idea" situations.

The reverse is a fine idea for someone who wants to stay in their home but needs some additional income.

Yeah I was thinking the same way. It reminds me of someone saying that buying Google stock is stupid because he bought it at 500 a share.

 

[radcen]

Signing a contract for a reverse on your deathbed is one of those "not such a good idea" situations.

The reverse is a fine idea for someone who wants to stay in their home but needs some additional income.

Yeah, I don't get... at all... why somebody would do it on their death bed.

But, the idea... in concept... seems good for people who are a little shaky financially in their later years and just want to remain comfortable in their home.

However, as potentially good as the concept sounds, the devil is often in the details.

 

[Superfly]

I'd not do anything like that without consulting an attorney, but from the beginning, it has always sounded like a scam to me. Just another way to separate the elderly from their money.

Any time anything sounds too good to be true, it usually is, and for the elderly who have no one to leave their estate to, this is just too good to be true.

 

[justabubba]

I'd not do anything like that without consulting an attorney, but from the beginning, it has always sounded like a scam to me. Just another way to separate the elderly from their money.

Any time anything sounds too good to be true, it usually is, and for the elderly who have no one to leave their estate to, this is just too good to be true.

let's use the example of the last one i wrote
$200,000 mortgage free home
$160,000 line of credit
no payments. ever
owner lives in the house until she dies (she's 85)

until the reverse mortgage, she had a mortgage free home
she lived in it
and her $1200 monthly social security check barely covered her monthly essentials
she had no nest egg if any economic emergency presented itself

someone tell me how this reverse mortgage recipient was abused

 

[Cephus]

let's use the example of the last one i wrote
$200,000 mortgage free home
$160,000 line of credit
no payments. ever
owner lives in the house until she dies (she's 85)

until the reverse mortgage, she had a mortgage free home
she lived in it
and her $1200 monthly social security check barely covered her monthly essentials
she had no nest egg if any economic emergency presented itself

someone tell me how this reverse mortgage recipient was abused

That only works if the recipient uses a significant portion of the line of credit. If they have a $160,000 line of credit and only use $500, the bank gets a $200,000 house for $500. Or, as someone above said, a relative who signs a contract on their deathbed and never gets a nickle of the line of credit has been seriously abused.

 

[justabubba]

That only works if the recipient uses a significant portion of the line of credit. If they have a $160,000 line of credit and only use $500, the bank gets a $200,000 house for $500. Or, as someone above said, a relative who signs a contract on their deathbed and never gets a nickle of the line of credit has been seriously abused.

wrong
the line of credit is the deceased's
that will go to the heirs
who can use it to buy back the mother's home should they so desire

the $160,000 could have been disbursed at closing had the client sought the lump sum. the money goes to the client/client's estate

 

[Superfly]

wrong
the line of credit is the deceased's
that will go to the heirs
who can use it to buy back the mother's home should they so desire

the $160,000 could have been disbursed at closing had the client sought the lump sum. the money goes to the client/client's estate

So the heirs (kids) have to buy back the house that they grew up? This is how I see a reverse mortgage. If someone sees themselves in the position of being elderly and having only social security to rely on, and have done no financial planning at all, these people are ripe for the picking for vultures like these reverse mortgage companies. Had they financially planned, they wouldn't need the easy money, but since they didn't, this is like a DREAM COME TRUE!!11!1 I think that it goes more along the lines of the mentality of the person getting the mortgage. Too much like a get rich quick scheme.

 

[MaggieD]

let's use the example of the last one i wrote
$200,000 mortgage free home
$160,000 line of credit
no payments. ever
owner lives in the house until she dies (she's 85)

until the reverse mortgage, she had a mortgage free home
she lived in it
and her $1200 monthly social security check barely covered her monthly essentials
she had no nest egg if any economic emergency presented itself

someone tell me how this reverse mortgage recipient was abused

I don't think she was abused. She just paid a hefty price for her security. And that's okay. As long as people understand that. Mostly, it's heirs who get pissed anyway. For the person themselves? They're probably happy as clams.

 

[Lord Tammerlain]

Signing a contract for a reverse on your deathbed is one of those "not such a good idea" situations.

The reverse is a fine idea for someone who wants to stay in their home but needs some additional income.

Most likely he was not of sound mind, and was conned into it rather then doing it from a well thought of position.

 

[tech30528]

when i see a celebrity pitching reverse mortgages, it lowers my opinion of them exponentially. tricking old people out of their money puts you among the lowest forms of scum.

I felt the same way when I saw Montel Williams hawking payday loans.

 

[Superfly]

I saw Gary Coleman hawking one of those "insta cash" loans where you wake up the next morning with up to $10,000 in your bank account. I paused the commercial once and read the fine print, and the interest rate was 99.48%.

 

[Fisher]

Reverse Mortgage: Scam or legit financial option?

What say you?

The mortgages themselves are not a scam, and in some circumstances, are the appropriate answer. The people have to go through third-party advising to try to make sure they understand what they are doing, have their questions answered independently, and to avoid the "I didn't read/understand" the fine print issues. Unfortunately, any time there is money involved, bad things happen to people. I have known mortgage brokers to put little old ladies into them when the broker themselves were getting huge fees relative to the lump-sum payout they were getting the little old lady into. They should be treated as an avenue of last resort because they very often destroy an estate, and I would advise against ever taking a single lump-sum check because you will waste it, very often on the same relatives who will be claiming you were a victim once they get all the money out of you and can't get more and still expect to get your house.

 

[Helix]

I felt the same way when I saw Montel Williams hawking payday loans.

yeah, those piss me off, too. I live in a town where poverty is prevalent, and there's a loan shark set up right at the edge of town. I see people streaming in and out every time I stop at Subway. It sucks slightly less than criminals doing the same thing, but it still sucks.