I occasionally participate in webcasts, taking questions from Vanguard investors on various financial topics. Almost invariably, someone asks about reverse mortgages. Should they or shouldn’t they? How do they work? And are they legitimate?
Last question first: Yes, reverse mortgages are legitimate, and they seem to be gaining in popularity. But it’s clear that as with any financial decision, opting for a reverse mortgage requires some homework. You will want to understand not only the provisions and payment stream but also the upfront and continuing costs.