Insurance Services of Washington Blog
When you enter your golden years one of your prime achievements is that you managed to afford your own home. Considering how home ownership is increasingly difficult for today's youth, pat yourself on the back.
But for most seniors, their Social Security check doesn't cut it anymore. It is sad because the elderly have rising expenses and a few possible new sources of income. They do have their home though.
While a Mortgage involves borrowing money to buy a house and then slowly paying off the loan, a Reverse Mortgage is where the bank gives you monthly payments which will eventually allow them to own your home when you have transitioned.
What this means is that you will get a monthly check that can supplement your other pensions so you can live a better lifestyle than if you had no other income.
When it’s time to go to the great beyond the bank will own your house but then it won’t matter to you anymore will it?
How Does the Bank Profit?
The old truth that real estate always goes up is in play here. People will still want houses. So, in effect that bank is paying the owner for the right to own the home when he no longer has any use for it.
When the time comes, they can sell the house for a profit. Since real estate prices will always trend up, and since they will be writing their profitable terms and conditions for the people who will purchase the house, there is no doubt that the Bank will get a huge payday.
Alternatives to Reverse Mortgage
If you are blessed with children then perhaps selling the house to them or letting them inherit the property might be a better option. Presumably, your children will be more than willing to lend a hand if you fall short on your daily needs. Besides the promise of letting them inherit your home for less than the cost of purchase would be good.
Regardless of whether you want to sell your home to the bank or allow your children to inherit it, getting insurance will protect your investment. At Insurance Services of Washington Inc., we aim to make our client's life easier with policies that are tailored to their needs. You can get more information about our products and services by calling our agency at (425) 868-1123. Get your free quote today by CLICKING HERE.