While most of the mortgage industry faces tough times brought on by the housing bubble and the meltdown in the subprime market, one section of the industry is shining brightly: reverse mortgages. Reverse-Mortgage-Information.com reports that activity in home equity conversion mortgages, the most popular type of reverse mortgage, is up 49% in the first forur months of 2007 over the same period last year.
There’s just no escaping the fact that millions of babyboomers embarking on retirement are counting heavily on tapping the equity they’ve built up in their homes to help finance their retirements. Reverse mortgages are one of the most cost effective tools around that allow senior homeowners to do this.
With a reverse mortgage, the lender makes monthly payments to the homeowner which accumulate (with interest) until the homeowner no longer owns the home. At this point the reverse mortgage is repaid, usually from proceeds of the home sale.
Reverse mortgages are complex and need to be fully understood by the borrower. The best resource we’ve found to get up to speed is Reverse Mortgage Info, an independent website that provides self-assessment tools, information and tips for seniors considering a reverse mortgage. If you’re thinking about a reverse mortgage, or just want to learn more, be sure to check this site out.