In the last post dated July 30th, we talked about considerations to “sell” home or apply for a reverse mortgage in Texas. Most likely you will come to one of two conclusions:
- Find another housing option that is a lot more attractive than you thought
- Conclude that where you live now is the best place for you to be
After much consideration, you will have a much better idea of the overall costs, benefits. and decide whether to stay or move. You will gain a better sense of what is most important to you, that’s the key. That key holds the decision “how” to evaluate the costs and benefits of a reverse mortgage.
Other things to consider:
If you want to make a home repair or improvement or need help paying your property taxes, you may want to find out if you qualify for any low-cost single-purpose loans that may be available in your area. Area Agencies on Aging (AAAs) generally know about these programs. To find the nearest agency, visit www.eldercare.gov or call toll-free, 1-800-677-1116. Ask the AAA for information about available “loan programs for home repairs or improvements,” or “property tax deferral” or “property tax postponement” programs.
If you are interested in a federally-insured HECM, know that all HECM lenders must follow HUD rules, and that many of the loan costs including the interest rate will be the same no matter which lender you select. Still, some costs including the origination fee, other closing costs, and servicing fees may vary among lenders.
If you live in a higher-valued home, you may be able to borrow more from a proprietary reverse mortgage. But it generally will cost more. The best way to see key differences between a HECM and a proprietary loan is with a detailed side-by-side comparison of future costs and benefits. Many HECM counselors and lenders can provide you with this important information.
No matter which type of reverse mortgage you are considering, be certain you understand all the conditions that could make the loan due and payable. Ask a counselor or lender to explain the Total Annual Loan Cost (TALC) rates, which show the projected annual average cost of a reverse mortgage, including all itemized costs. Read full story.
If you want to talk with someone about whether to sell or apply for a reverse loan, please call me, Bob Heckler at (512) 328-2225. Check out Reverse Loan Guide.
