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For seniors who have equity in a prior home loan, reverse mortgages are growing in popularity. These are loans for seniors at least 62 years of age, and allow them to pay no monthly payments until they pass away or move out of the home – in fact, many people actually receive money from a reverse mortgage, as long as they live in their home themselves.

Reverse mortgages can be very beneficial for some people, but they aren’t without risks. At Altius Mortgage and our partners, Mortgage Ogden, we’re here to help you navigate those risks. Here are a few common mistakes people make with reverse mortgages, and how you can avoid them.

Underestimating Fees

Reverse mortgages can be expensive, and can come with high closing costs – origination fees can be larger than conventional mortgages as well. In addition, you will have to pay HUD mortgage insurance up front. If you can’t afford these hikes in insurance, taxes and maintenance, a reverse mortgage might not be for you.

Title Removal

Some couples attempt to remove the younger borrower from the title so only the older borrower remains. The flaw here, though, is that if the older spouse passes first, the younger one is then responsible for paying the balance. If arrangements haven’t been made or instance doesn’t cover expenses, and the younger spouse doesn’t qualify for their own reverse mortgage, he or she might have to sell the home and move.

Condos

Not all condos will necessarily qualify for reverse mortgages, so don’t simply assume. Condos must meet tighter FHA regulations than single-family homes, and condo developments as a whole can be disqualified from reverse mortgages if a high number of owners are delinquent on association fees.

Scams

Reverse mortgage scams have risen in popularity right alongside the mortgages themselves. If a reverse mortgage broker is attempting to charge you crazy rates and fees, perhaps even as high as the original loan, this could be a telltale sign. Other scammers may provide fraudulent loans or attempt to steal identities. Our brokers can help keep you far away from these scams.

Losing Eligibility

Reverse mortgages can affect Medicaid benefits and Supplemental Security income, if you don’t take the right precautions. If you take all your money up front and deposit the proceeds into a bank account all at once, you could be making yourself ineligible for these benefits. Contact your financial advisor or SSI administrator before moving forward to make sure you’re in the clear here.

Want to learn more about reverse mortgages, or any of our other mortgage services offered? Speak to the mortgage brokers at Altius Mortgage and Mortgage Ogden today.

June 1, 2017

Avoiding Common Reverse Mortgage Pitfalls

For seniors who have equity in a prior home loan, reverse mortgages are growing in popularity. These are loans for seniors at least 62 years of age, and allow them to pay no monthly payments until they pass away or move out of the home – in fact, many people Read More
May 15, 2017

What Size of Mortgage Can You Afford?

We’re here to help with all the technical details of a mortgage situation at Altius Mortgage and our partners at Mortgage Ogden, but that’s not all we do. Our mortgage brokers are also here to offer advice, opinions and expertise throughout the process, including areas you might be confused about. Read More
May 1, 2017

The Factors That Change ARM Rates

For certain people, adjustable-rate mortgages are the preferred loan format. This is a format where mortgage rates can change through the life of the loan, and the number you’re repaying to mortgage lenders may change. For people who stand to potentially benefit from the benefits of these kinds of loans Read More
April 15, 2017

Learning the Benefits of No Cost Mortgages

At Altius Mortgage and our partners at Mortgage Ogden, it’s our mission to get you the best mortgage option for your situation. Our mortgage brokers are trained to spot the details that might make a certain type of mortgage or refinance more prudent for you and your family, and to Read More
April 1, 2017

Learning and Managing Credit Score Calculation Factors

No matter what mortgage area you’re looking into, credit score is going to be a huge factor no matter what. It’s one of the single largest factors in getting you the best mortgage rate, and also in which kinds of advantageous mortgages you’ll be eligible for. At Altius Mortgage and Read More