Posted on: 18th Aug, 2008 07:37 am
hi, my mothers home is in desperate needs of repair. She currently holds a rev mort, would it be wise for her to refi to a 203k rehab loan to do the necessary repairs.She is on a fixed budget and will be 78 this year,would this be wise or not?
Has she used allthe proceeds from the reverse mortgage yet? did she accept a lump sum payment or is she getting monthly payments or does she have a line of credit? Has her home increased in value since her reverse mortgage? How much was her reverse mortgage for versus the current market value of the property? I would advise you to first speak with a reverse mortgage originator (such as Wells Fargo Home Mortgage) and find out if she has any options in refinancing or withdrawing more cash from her house. if she took out an FHA rehab loan, she would have to pay back the reverse mortgage plus add in the repairs and would have to start making payments on that loan, and rehab loans usually have higher interest rate. Does she have anything else that could be used as collateral on a loan for the improvements> How much do you estimate the repairs would cost? Wells Fargo also offers FHA rehab loans. (no, I dont currently work for Wells Fargo Mortgage now, although I used to, that's why I am familiar with some of their products!)
The reverse mortgage program has a repair feature. I have appraised many homes for reverse mortgages over the years and when the repairs are identified the repairs can be made from the loan. Look for a reverse mortgage professional.