To Buy Or Not To Buy A Home With A

To Buy Or Not To Buy A Home With A Reverse Mortgage
Many homeowners are now looking to buy a home with a reverse
mortgage. Tremendous growth in the housing market over the last
few years has given many homeowners a considerable boast in
equity.

Take for instance, Doris and Robert who purchased their home 45
years ago for about $15,000. Now in their mid-seventies the
couple is pleased to discover that area home values have
skyrocketed and single family homes like theirs are currently
selling for a minimum of $150,000.

Doris and Robert like many other homeowners who originally
purchased their home for a modest price and have maintained the
same residence for a number of years are now retiring and finding
reverse mortgage value in their home equity.

Seeking a change, many of these homeowners are looking to buy a
home with a reverse mortgage. They are now thinking that the
equity they have built up could be used to finance a second home
in the country or a waterfront cottage.

While only a very small percent of mortgages are actually the
reverse type, reverse mortgages are gaining in popularity.
Federally insured since the late 1980's, the reverse mortgage
allows mortgage-free homeowners to borrow against their equity.

Traditionally, homeowners only saw the disadvantages of a reverse
mortgage and regarded them as a last ditch effort to avoid
foreclosure, pay medical expenses in later years or to keep their
home in good repair. Today's senior homeowners however are
turning to a reverse mortgage as a creative way to enhance their
retirement years.

A reverse mortgage now provides retiring couples with an
opportunity to enjoy the fruits of their labor. They have raised
their families, paid off their mortgage during their working
years and are now looking to enjoy a few luxuries. Further,
couples who never had an opportunity to travel can now do so by
dipping into their home equity.

When you buy a home with a reverse mortgage you are able to pay
cash for the second 'vacation' home while continuing to live in
your primary residence for as long as you wish or are able. Once
you die, your primary residence is usually sold to pay back your
reverse mortgage loan, while the second home becomes part of your
estate.

In order to buy a home with a reverse mortgage you also must be
age 62 or older. As a reverse mortgage borrower, you can opt to
receive a lump sum, a line of credit, or regular monthly
payments.

While this may seem like a win-win situation for the senior
homeowner, the borrower must beware. It's important to proceed
with caution when dealing with what is quite possibly your single
largest asset.

Only after careful consideration should you buy a home with a
reverse mortgage. Reverse mortgages are not for everyone and
borrowing against your equity can quickly turn into a negative if
you don't fully understand the advantages and disadvantages of a
reverse mortgage.

One of the major disadvantages of a reverse mortgage is that you
would not have the funds available should you or your spouse,
require long-term home or hospital care and all your money is
tied up in a reverse mortgage.

Despite the potential drawbacks, such mortgages programs are
allowing today's seniors the opportunity to buy a home with a
reverse mortgage and enjoy the retirement they always dreamed of.

Top Five Credit Card Mistakes.When you're dealing with credit cards,

Top Five Credit Card Mistakes.
When you're dealing with credit cards, you're playing with fire. Unfortunately, there are plenty of people out there who don't realise that, and make all sorts of dangerous mistakes with their credit cards every day.

Paying Late.

If you don't set up any kind of automatic payment, then it can be tempting to just put your credit card bill on a pile and get to it when you have time. Before you know it, a few weeks have gone by and you're late. If you leave it to the deadline, you might find that the payment won't get there quickly enough - it's not a deadline for sending the money, it's a deadline for them receiving it.

Paying late is a big mistake for an awful lot of reasons. You will almost certainly be charged a late payment fee, and your late payment will go on your credit report for everyone to see. You may also find that you lose any good rate you had, and your debt is automatically thrown onto the very worst rate the company offers.

To avoid late payment, you should always post your payment a long time before the due date (at least a week). If you've left it to the last minute, phone up and try to pay that way.

Being Taken in By Rewards.

It is never, ever worth getting a higher-interest card simply because it offers some kind of loyalty points, flight miles or whatever. Even if it offers a cash reward, it is unlikely to be more than you would pay in extra interest - after all, why would they give you free money? All 'rewards' do is pay you off with your own money to make you feel like you're getting something for nothing. You're not.

Collecting Cards.

Seeing some people opening their wallet or bag is a scary experience. It looks like they have about a hundred credit cards in there, some of which they haven't used in years. They have trouble keeping track of all the different cards, balances and interest rates. Don't be one of these people. You should limit yourself to a maximum of three cards at a time - any more starts to make you look over-committed in your credit report, and could get you turned down for a bigger loan.

Maxing Them Out.

Your limit is just that: a limit, not a minimum! Whatever you do, don't get a card and immediately spend your whole limit. This looks very bad. It is better to spend about halfway regularly and pay it back. Wait for the company to increase your limit (which they quickly will), and then you'll get that extra money without the stigma of having a maxed-out card.

Not Reading the Terms and Conditions.

Finally, as ever, don't sign anything you haven't read! I know it's hard going and you're busy and all, but if you can't manage to read the terms and conditions then you shouldn't get the card. Pay special attention to any future increases in rates, and what kind of fees you can be charged.