Tapping home equity for cash - Reverse mortgage could go no-cap
The Cincinatti Enquirer, December 10th, 2005
WASHINGTON - Juanita and Joe Sanders of St. Louis were trying to
figure out how to pay for a new roof two years ago when their son
suggested a reverse mortgage.
Reverse mortgages allow cash-strapped seniors to draw
equity out of their homes to meet financial obligations. The Sanderses
- Juanita is 81 and Joe is 97 - were sold on the idea they could stay
in the home they've owned since 1953 and not make any payments.
"The equity is there as a line of credit. It stays
right there until I need it. It keeps me carefree, not a worry," said
Juanita Sanders.
The Sanders' reverse mortgage is among 158,000 that the
Federal Housing Administration has insured since 1989. The program has
become so popular - the number of reverse mortgages more than doubled
from 2003 to 2005 - that Congress earlier this year raised the cap on
FHA-insured reverse mortgages, from $150,000 to $250,000.
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