• Question
  • reverse mortgage to help my sons

    Asked on 12/15/2007

    I am considering a small reverse mortgage (no more than $12,000) because both of my grown sons have fallen on bad times,and I wish to purchase them both an inexpensive car. I have $20,000 of life insurance, which will be theirs when I die. I am in very bad health and don't expect to live to a ripe old age. My concern is that I do not want to get more money than would be payable out of my life insurance, as they will also inherit my house and I don't want them to inherit a mortgage payment. I do not know how the interest accrues or at what rate. Can you help me? I am 67 yrs. old..

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  • Categories: Tapping home equity, Housing

Answers

  • NewRetirement User

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  • This is only my opinion. A reverse mortgage is meant to help you as the homeowner and I believe will pay you a monthly income and not a lump sum amount. If your home is paid for you can change the deed to a 'Transfer on Death' deed and have the house transfer to your sons upon your death and this will also bypass probate in most states. Whether you are in bad health or not it appears that your sons will not be able to help you financially if needed and I would reconsider jeopardizing your own financial security. Don't sell yourself short.

  • Login to rate this answer:   Answered on 12/29/2007
  • NewRetirement User

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  • take a small credit line for that amount - how much is the home worth - rates are incredibly low so there is no way you will put your heirs in a bad situation with such a small amount - even if you were to live for the next 20+ years the reverse mortgage was designed to allow seniors to tap equity as needed with the hecm saver rates are at 2% and hecm mip is only .01% percent

  • Login to rate this answer:   Answered on 9/30/2011
**All above answers are provided as general information only. No warranty is made regarding the fitness or accuracy of the information provided in this answer. You should seek advice from a licensed CPA, attorney or CERTIFIED FINANCIAL PLANNER™ as to your unique financial situation.