Reverse mortgages vs baby boomers
propertyman | Aug 06, 2009 | Comments 0
Its a thing about baby boomers, they have always wanted a good life. Many of the baby boomers are still trying to get the most of the good life in the twilight of their lives and living it up.
What better way to do that , but to spend out the money that you have saved all your life to put into your house.Its called a reverse mortgage.
Download your free copy of ASIC’s independent guide to reverse mortgages and other equity release products: Thinking of using the equity in your home?
Or order your copy by calling ASIC’s infoline on 1300 300 630.Audio available soon
Use FIDO’s reverse mortgage calculator
What is a reverse mortgage ?
Let me give you an example !
Say you have spend most of your life paying out you home and its been paid off and now after all these years of living life you want to live it up. Where do you get that money from to live it up!! You take a reverse mortgage
Well your $300,000 or $600,000 Home is all paid up so why not take a reverse mortgage and get money $$ from the bank. Go on that long planned holiday or then just hit the roads. Depending on the value of your property you still might be able TO LEAVE SOME BEHIND AS inheritance for your siblings.
At the same time baby boomers who don’t do their maths with their reverse mortgage calculations.. could end up putting a big burden on their kids for the future.
A reverse mortgage allows someone aged 60 or over to borrow money against the value of their home. It usually only needs to be repaid when you sell the house, permanently move out (such as to go into long-term aged care) or die.
Reverse mortgages work in the opposite way to home loans. Instead of the loan sum diminishing because of your repayments, interest is applied to your loan so the debt increases. You’re not required to make any repayments but the impact of fees and interest means the debt grows over time. At current interest rates, the amount you owe would double in less than 10 years.
Links:
Agencies Slash Cost of Reverse Mortgage Counseling
Baby boomers – Australia’s Culture Portal
Reverse mortgages: What are they and do you qualify?
Want to know more?
See the full report from Choice. Choice is an independent, non-profit organization for Australian consumers.
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Filed Under: Australia • baby boomers • Example • home loans • mortgage • Mortgage rates • Real Estate • refinance • reverse mortgage
