Just like with any home refinance or home purchase loan, there are charges that will be applied toward a reverse mortgage. Reverse Mortgage fees include closing costs, an origination fee, an up-front mortgage insurance premium, an appraisal fee as well as other miscellaneous costs, such as title insurance, inspections and miscellaneous paperwork. Every applicant is unique and the fees vary with each loan. Typically, the origination fee charges 2% for the first $200,000 and an addition 1% thereafter capping off at a certain amount (varies with each lender). Another 2% of the maximum claim amount is generally charged for the insurance premium. The closing costs consist of a certain dollar amount per service charged. These charges typically equal to approximately $1200.
Are Fees Applied to Reverse Mortgages?
February 22nd, 2009 — Reverse Mortgage
The Pros and Cons of a Reverse Mortgage
February 21st, 2009 — Reverse Mortgage
You may think that getting a reverse mortgage on your home when you retire is a great idea, and it is, but there are some downfalls to this program as well. There are several reverse mortgage pros and cons to consider before taking that step. Some of the positives are that you can receive a large sum of cash from the equity of your home. You also do not have any monthly payments or a requirement to pay it back until you sell the home or pass away. The downside of a reverse mortgage is that if you decide to take out 100% of the equity, it will leave your heirs without an inheritance from the sale of your home. If leaving a financial legacy to your children or grandchildren is important to you, you should consider either declining on the reverse mortgage, or taking out a smaller amount.