Posted by Don Courtney on 11/28/10 1:06pm
Msg #362927

Reverse Mortgage Purchase

I recently completed a reverse mortgage signing for a purchase, which was the first time I had heard about this type of transaction. The buyers put about 40% cash down payment then never make a payment. A bit like pre-paid rent for life certain, since the property will likely then revert to the lender.

The concept made sense for these people as they commented that they could not afford the monthly mortgage payments on their retirement income...and they have no children. With the Rev Mortgage, they are able to move from a small, old apartment to a brand new Senior Condo complex.

Reply by Yoli/CA on 11/28/10 1:24pm
Msg #362929

Interesting concept. Wonder what happens if they happen to outlive their investment ...?

Reply by ReneeK_MI on 11/28/10 2:19pm
Msg #362936

loan is repaid under the same terms as with

a R/M refi (with the gov't insured ones, anyway). Due & payable when the last borrower has either died, moved out/stopped living there for one year, or sells.

Reply by Calnotary on 11/28/10 3:03pm
Msg #362949

I have done 3 or 4 of those.

Reply by MW/VA on 11/29/10 8:48am
Msg #363003

I think it's fantastic that RM programs include purchases. It certainly will improve the quality of life for many seniors who lost money in investment accts., etc.