Public Television and Radio for North Texas published an interview with Todd Mark of Consumer Credit Counseling Service of Dallas discussing reverse mortgages.
Sam Baker talks with Mark about reverse mortgages which you can read in the interview below.
In this current economy, some people may be considering a reverse mortgage – a loan that lets a person 62 or older convert the equity in a home they own free and clear – or nearly so – into cash. It’s more complicated than it sounds, though. Todd Mark of Consumer Credit Counseling Service of Dallas will cover the topic in a series of online webinars about managing money. In this KERA Economy segment, Sam Baker talks with Mark about the idea behind a reverse mortgage.
Todd Mark: The purpose of this is to help people tap the equity in their home while they’re living and for a lot of folks, this is going to help really fund gap what’s happened to their retirement plan, which has obviously broken in the last 10 years.
Sam Baker: And that’s key, you have to remain in the residence?
Todd Mark: If you weren’t going to remain in the residence, a reverse mortgage probably wouldn’t make sense for you. You’d want to sell it in a traditional way because you’re going to get a lot more money selling it traditionally then going through a reverse mortgage. The benefit is you get to live in this house as long as you live so if you do this at 62 and you take all the money they’ll give you up front, you get to remain there until you and if you’re married or two names are on the loans until both of you have passed away.
Sam Baker: But it is a loan so at what point is it paid back and how?
Todd Mark: Okay so it is payable back either when you move or the last name on the loan passes away and at that point, the heirs of the estate would have the choice of either having it sold and the bank keeps it or you can pay it off. You can say alright this was how much was borrowed in the reversed mortgage over the last 30 years, we’d like to pay it back in full so that we can keep the property for another generation or two.
Read the rest of the interview at the link below.
