Every time I see one of those reverse mortgage commercials on television – especially the one with Fred Thompson – I have to fight the urge to throw something at the TV. I’ll come out of the closet and admit it, I hate reverse-mortgage commercials with a passion that is difficult to describe.
For one thing it’s that line about the benefits for seniors – “you don’t have to worry – reverse mortgages are insured by the United States Government”. Let’s translate that statement into plain English– What that line really means is “WE don’t have to worry – if your house goes down in value we’ll just let the taxpayers, (i.e. your kids), pay off your balance due for you.” But, coming from former Senator Fred Thompson, “The Fonz” Henry Winkler or a smooth, mature Robert Wagner, it sounds soooo comforting.
Other so-called “benefits” of reverse mortgages — that they are “important-financial-tools” and can provide “tax-free cash“, are merely circumstances stated as a benefit. That’s right, you can take $60,000 out of your home with a reverse mortgage and it’s going to be “tax-free”. Whoopee. I’m sure some of you already know why it’s tax free…it’s …read more