What Is The Cost Of Waiting With A Reverse Mortgage?
I think it tends to be human nature in that for some people, they hesitate to make a decision for just about everything that requires one. Whether it is getting married or maybe divorced, having children, taking a leap at a new career or choosing a paint color for your house.
And it’s prudent not to blindly rush into anything, you should be well informed before making decisions that are crucial to your life.
Most of the time these decisions are minor, but what about the ones that are not and could potentially have a huge impact on your life and future?Sometimes this hesitation comes from looking for the best price for something if you are considering doing a large purchase, but other times it comes from a place of being worried about the possibility of making a “wrong” decision.
Or not being educated enough about whatever it is you are considering. So, you put off making any decision about it indefinitely.
A good question to ask yourself is, “what is the worst thing that could happen if I make a decision and it turns out to be awful?” Asking yourself that question can potentially take away your fear and help you to move forward.
However hesitating or waiting can continue for a very long time and it can be costly. And what is the “cost’ of waiting?
Too often in my profession as a Reverse Loan Consultant I see this happen. The potential borrower wants to wait and “think about it” whether or not they wish to apply for the loan. Depending upon their situation this may prove to be very costly, especially if they are withdrawing funds from their savings to make a mortgage payment. How long will their savings last and will the funds they withdraw have possible tax consequences?
Or it’s the adult children of a senior who now requires professional caregiving services and they are running out of money to pay for it, but they hesitate to use the equity in their parent’s home to cover this expense, because they want to “protect” their inheritance or they are withdrawing their own funds from a savings to pay for the monthly expense.
Professional caregiving is very expensive and can run from $3500 to $8,000 a month. Waiting can quickly deplete a savings and a retirement fund. And the other consideration is the” cost” of money. Mortgage interest rates have increased recently making borrowing money more expensive.
But if they wait, it could very well end up being a higher rate and less funds to the borrower.
Again, what is the cost of waiting?