The Drawbacks of a Miami Reverse mortgage

Reverse mortgages are a very different type of loan and the risks involved with it are also very different. Before choosing such a loan, know the drawbacks and get some qualified advice on whether it is the right choice for you.

These are some of the things you need to consider before choosing a reverse mortgage:

• Most reverse mortgages have variable rates. Your rates will likely change according to market conditions.

• Since reverse mortgages usually work by decreasing your home equity, you can use up most of the equity in your home, leaving little money from the house for you and your heirs. However, a “non-recourse” clause, found in most reverse mortgages, prevents either you or your heirs from owing more money than the value of your home.

• Since you keep ownership of your home, you are still responsible for property taxes, utilities, insurance and maintenance.

• Lenders usually charge origination fees and other closing costs for a reverse mortgage. Lenders also may charge servicing fees during the duration of the home mortgage.

• Interest on a reverse mortgage is not deductible on your income tax returns until the your loan is paid off in part or whole

• There are usually a chance to securing a cheaper solution to your problems (credit line, refinancing your existing mortgage, etc.)

To solve some of the drawbacks mentioned above, make sure you get your Miami reverse mortgage through a reputable company who will educate you and inform you throughout the mortgage process and beyond.

If you have any questions, you can call us at anytime.