Are Reverse Loans Safe?
Reverse loans are highly regulated and the senior consumer is well protected from any type of financial abuse and over the last decade many regulations have been put into place which makes a reverse loan a very safe option for seniors to use.
Before anyone can start the loan process, they must complete HUD Counseling with an approved Counseling agency and they can ask questions and discuss their concerns with the counselor.
A list is provided to the potential borrower with a proposal provided by the Loan Officer that offer many counseling agencies for them to chose from.
All fees are disclosed in the proposal, and can be discussed with the Loan Officer. Along with federal regulations and disclosures, each state has their own set as well.
Spouses who are under the minimum age 62 will be able to remain in their home if the older borrowing spouse predeceases them, and no longer have to worry about selling and moving out of their home.
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Seniors are worried about out-living their money, and with medical expenses, care giving costs, utilities, food and other monthly expenses, funds from a reverse loan can make life easier and certainly remove the stress and worry about running out of money.
They are a very safe and sensible option on how to use the equity in your home, for funding and preserving your retirement and could be an important part of a financial strategy to make your savings last longer.