Reverse Mortgages Gain in Popularity
So, after all the fiascoes with subprime mortgages and lax underwriting standards (if you can call them that), “no doc” loans are a thing of the past, right?
For the most part.
However, there’s still a niche of the market where lenders are approving borrowers with virtually no paperwork: reverse mortgages.
The catch, of course, is that with a reverse mortgage, the bank is making monthly payments to the borrower, not the other way around.
Reverse mortgages are particularly suitable for older, long-time homeowners who have modest income, but a ton of equity in their existing home.
Lenders are more than happy to let such “borrowers” tap that equity to make a reverse mortgage on the purchase of a “downsized” property.
Even more than with traditional mortgages, fees and terms on a reverse mortgage are key.
In other words, do your homework!
