Readers comment on reverse mortgages, we respond

I think financial advisors who work with clients nearing retirement should strongly encourage them to get a “cash out refinance” before they stop working (and lose the income). This would avoid the pressure to take out a reverse mortgage and leave their clients in a stronger financial position. This is what we ultimately did.

This is a far out idea (for a lot of reasons), but in comparison with getting a reverse mortgage, it may be better to take a job long enough to qualify for “cash out refinance” (if your health allows it).

Comment: I looked into a reverse mortgage that I saw advertised on television. I received the CD disk from that company by mail.

The CD disk was all advertising, with no specifics or details about reverse mortgages, and nothing about financials, dollar loan amounts and costs. I had to call them to get the details. On the telephone, I told them that I wanted a reverse mortgage on my house, which was valued at about $200,000.

I also informed them that I am 68 years old, that my FICO credit score is 810, and I fully own the house with no outstanding mortgage. They told me that the maximum loan they give is 50% of the value of my house, or around $100,000. They also let me know that the cost to get the loan would be about $15,000. Therefore, the net amount I would receive from a $100,000 Reverse Mortgage was $85,000.