BOSTON (CBS) – Reverse mortgages have been around since 1990 and there were just over 51,000 nationwide last year.

According to the commercials, you can borrow against the equity in your home and the money does not have to be paid back until you die or want to move. Sounds very tempting.

These mortgages are not for everyone. They may be best for a cash strapped elder who wants to stay in their home! Elder being someone in their late seventies or early 80s. An individual who is on a fixed income and living in their own home and wants to stay in their home may find a reverse mortgage gives them the cash they may need to make repairs or modifications on the house so they can continue to live there.

But some retirees are going on a shopping spree, traveling with the money or helping their kids get out of debt. These are not good uses of this program.

To be eligible for a reverse mortgage you must be at least 62 years old and own your home although you can still have a mortgage.

At 62, if you are healthy, you can look forward to another 30 years in retirement and you have just tied up your largest asset. Before you sign on the dotted line be sure you talk with a financial planner to see if a reverse mortgage is right for your situation. In addition, HUD now requires extensive counseling and budget planning before they will sign off on the loan.

I am not a big fan of reverse mortgages. As an alternative you might just consider selling your home, pocketing the profit and moving into a smaller less expensive place or even elder housing or an assisted living facility. Financially you would be ahead of the game.

There is no free lunch here. There are upfront fees. Lots of them. I used the median listing price of a house in Boston of $350,000 and using an online calculator you would be entitled to a lump sum of 186,500 to $206,500.

You can choose to receive the proceeds from a reverse mortgage as a lump sum, in fixed monthly payments either for a set term or for as long as you live in the home, as a line of credit, or as a combination of these.

The Federal Trade Commission, HUD and the AARP all have information on reverse mortgages. The FTC’s toll free number is 877-FTC-HELP (877-382-4357).

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