Deborah Royster
speaker
24 appearances
1 recordings
1 series
first heard May 2024
last heard May 2024
Deborah Royster’s voice in public audio — every appearance, attributed to the second.
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Appearances
Essentially, a reverse mortgage is a loan.
It's a type of loan that allows you to use the equity in your home while you're still living in it.
With a traditional mortgage, a person borrows money to pay for the home at the time of the purchase, and they pay it back over time.
And so with each payment, you build equity in your home, and your loan balance decreases.
With a reverse mortgage...
the amount that's borrowed doesn't need to be paid back until the borrower no longer lives in the home and the borrower is required to continue to meet certain obligations.
There are no monthly payments, but interest and fees are added to the loan balance each month.
So in contrast to a forward mortgage, the loan balance with a reverse mortgage goes up, not down, over time.
So as the loan balance increases, your home equity decreases.
Sometimes an older consumer is presented with a you-can't-miss sort of investment opportunity where they are encouraged to take out a reverse mortgage.
Or there are also scams where older consumers are encouraged to take out reverse mortgages to pay for high-cost repairs or improvements to your home.
Scammers try to convince the reverse mortgage borrower to sign a power of attorney that gives the scammer sole access to the reverse mortgage loan proceeds.
One important source of information would be housing counselors from the Department of Housing and Urban from HUD.
They have quite a bit of experience, knowledge about these products, and can certainly advise consumers.
In addition, if a consumer has concerns or questions about a reverse mortgage loan product, they have a complaint about an issue they've encountered, they could also file a complaint online.
with the CFPB at consumerfinance.gov slash complaints.
There's no one right answer for everyone.
Each of us has to think about our own personal circumstances.
They can look at other ways to lower expenses.
They can also look at other home equity options that may be possible to them
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