Quote:
Originally Posted by bruce213
Question for John W.
As I understand it you are paying monthly interest of $200.00 and you owe the bank $65000, which you could pay off anytime or when the house is sold?
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That's why you have a RM and not an equity loan, there are no payments. The bank appraises the home's value and you withdraw from a fund that is about 45% of that amount. It's paid back when both occupants die and they get the home. If the home is sold for less than the amount owed, then whoever you designated will receive the balance. The $200 a month is part of the loan that has to be paid off.
In order to qualify you must own the home outright and both occupants must be 62 years of age. The bank has calculated the length and risk of what they're doing just like you will calculate the risk of what you're doing. If I don't plan on moving, have no heirs, I don't see any risk in using cash that would not be available otherwise.