supercub
Modesto CA
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Joined: 04/24/2005
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I still have a few years to go till I retire, but have been thinking of using a Reverse Mortgage to buy a diesel pusher at that time. I'm debt free now and plan to be that way when I retire too. Has anyone else used a reverse mortgage to help buy a motorhome? Good idea, or bad idea? Any suggestions/comments. Thanks
Brian
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wayne_tw
South Dakota/Georgia
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That, my friend, is a very bad idea. The costs associated with a reverse mortgage will be much more than the costs associated with a loan for the RV. You are fooling yourself if you think you are staying debt free and buying a motorhome with that reverse mortgage. You are in debt with that reverse mortgage, it is due upon your death. Where will your spouse live? What happens if you need to move for whatever reason? Transferring home equity to a depreciating equity payable upon death makes no sense. If you want a motorhome, pay for it with your funds on hand or finance it and service that debt with your income. YOU WILL REGRET A REVERSE MORTGAGE UNLESS NEEDED FOR EXTREME CIRCUMSTANCES. Even then more often a better choice is to liquid the house use the cash for the extreme circumstance and rent housing using existing income.
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tatest
Oklahoma
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With a reverse mortgage, you will no longer be debt free.
Financing a motorhome with a reverse mortgage, you would need a loan, the payments fitting within the proceeds of the reverse mortgage. It would be up to the lender, whether or not they consider this sufficient income for approving the loan.
Tom Test
Itasca Spirit 29B
2001 Ranger Edge
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lyle_47250
madison indiana usa
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Reverse mortgage would be the last thing I would do, I too am debt free and would NEVER use a reverse mortgage to buy something with a value that sinks like a rock. It's a free country.
Lyle & Ginger and the 82 Revcon
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supercub
Modesto CA
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Couldn't you take a lump sum from your reverse mortgage and pay esentially cash for the motorhome. Such as.........buy a used motorhome for $100,000 trade in worth $35,000. Home worth $200,000 Take a reverse mortgage for $65,000 and you wouldn't owe anything on the motorhome, and my understanding on a reverse mortgage is, theirs no payments, and it doesn't have to be paid off till you no longer live there, or your death.....is this right? or am I coming to the wrong conclusions? Or is this not what a reverse mortgage is used for? Just trying to educate myself about something I know very little about. thanks
Brian
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bigdogger
Texas
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Proceeds from a reverse mortgage can be used for anything you want. Be aware that rates on reverse mortgages can be very high and they tend to have high fees. Also, the earlier in your life you take a reverse mortgage, the less those proceeds will be. I tend to agree with Lyle that using your equity you have spend years acquiring in your home to buy an RV that will sink in value every year is a bit foolish. Also, unless you have a lot of other assets (which should be used to buy the RV if you have them) you are shooting the biggest bullet in your gun for an RV. What if you really need the equity in your home in the future? I can think of a million things that could come up that I would much rather have that money for. Maybe a nicer nursing home, a new kidney, maybe by the time you are ready to go they will have some new and expensive drug that will turn you 25 again. Wouldn't be a shame you couldn't get it because you spent your money on a motorhome?
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hwybnb
Southern California
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I believe that most financial experts will tell you that reverse mortgages are a bad idea because the costs associated with them are too high compared with other types of financing, and would be especially inappropriate to fund the purchase of a rapidly depreciating asset such as a motorhome. Do your research carefully.
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RCMAN46
NorthWest
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The way I see it is this. There is a lot of high pressure sales pitchs on TV and other sources. When ever somthing is pushed as hard as they are pushing the reverse mortgage it means it is a good deal for the banks and lending institutions and a bad deal for the one borrowing the money. When I see high pressure I back away.
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Bumpyroad
Virginia
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supercub wrote:Couldn't you take a lump sum from your reverse mortgage and pay esentially cash for the motorhome. Such as.........buy a used motorhome for $100,000 trade in worth $35,000. Home worth $200,000 Take a reverse mortgage for $65,000 and you wouldn't owe anything on the motorhome, and my understanding on a reverse mortgage is, theirs no payments, and it doesn't have to be paid off till you no longer live there, or your death.....is this right? or am I coming to the wrong conclusions? Or is this not what a reverse mortgage is used for? Just trying to educate myself about something I know very little about. thanks
Brian
that is my understanding also. whether it is a good "investment" or not doesn't really matter to me. Basically you sell your house for X dollars, live in it payment free till you sell it or die, and IIRC even if it is worth less than the loan at the time of death, they eat the loss, not you.
bumpy
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TubaPete
Comstock Park, MI
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You have to remember at the end of the term of the reverse mortgage, they own your house. Outlive the mortgage, you have have no home. You said you were close to retirement. Sounds like a lot of years to stretch out a revers mortgage.
Tuba Pete
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