An interesting response to the blog article came from one reader who noted that one of the realities of downsizing is that there is often a difficulty to find appropriate (“smaller”) housing in certain areas of the country and also that increases in property taxes are “eating into (retirement) income.”
The CRC article also notes that when applying for a reverse mortgage – “regulators require that homeowners meet with a government-approved housing counselor to apply for a loan.”
Finally, few retirees are taking advantage of reverse mortgages. One suggested reason is “reverse mortgages are an unfamiliar and complex financial product, and their costs, benefits, and risks are poorly understood.” Any loan/mortgage is a legal document and as such should not be entered into unless the borrower fully understands both the short-term and the longer term financial impact.
In addition, I would add, that before you sign any contract/document, particularly one that is unfamiliar and complex, seek competent, professional advice to review the details of the legal document.
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