Should I Do A Fixed Rate Reverse Loan Or An Adjustable Rate?
On the surface, this sounds like an easy question. Everyone wants a reverse mortgage with a fixed rate, right? So how do you actually know if the correct choice is the fixed rate or the adjustable rate? Which program makes the most sense for you? Here are a few facts needed to help make your decision.
Did you know that with the fixed rate reverse mortgage loan you only get one option? It is to take all of your equity that is available in a lump sum. Knowing this will help you decide if this is the right choice for you. Some prior clients have used the lump sum disbursement in the following ways:
1. To pay off your current loan and the balance is high enough to leave you only a small amount of cash to be drawn.
2. You are considering doing a remodel or major repair to your home and this remodel uses up a majority of your available funds.
3. You are purchasing an expensive item like a car, a motorhome, or even a second home. Again this should consume most of your available equity draw.
4. By combining the above items you may be able to total most of your available draw.
The idea is, if you have a place to put (or spend) the money, it won’t be a burden to have it “sitting around”. You have to keep in mind that you are accruing interest on any money that is drawn or borrowed.
What should you do if you don’t want or need all the available equity right now? This is where the reverse mortgage with an adjustable rate comes into play.
You can get more information on a reverse mortgage loan or read other articles written by David Prulhiere by visiting redwood reverse mortgage. For a limited time, get the free report titled: “Five Essential Things to Know Before Getting a Reverse Mortgage” just for visiting.