[tc-sacto]

BerettaFan.
Sure. For the most part, a reverse mortgage would not make any sense for a home in a city like Rapid City South Dakota.(assuming the home owner has a goal of passing on the home to heirs. If not then a RM may be fine)

For a blue collar couple who bought a home in San Jose California in 1975 a RM may be a very good tool. Assuming they want to stay in the home. Joint life expectancy is around 20 years for a 70 year old couple. Thats plenty of time for future appreciation to out pace the interest cost. (Which, historically, has a fairly good probability to do)


So the parents get money to live on, get to stay in their home(assuming that's important to them) and can still pass on an asset with equtiy to the children.

Again not right for everyone, but can be a useful tool.

as a side note:
Aprox cost to set up the RM about 5% of prop value.(Real Estate brokers commission to sell the home about 5%)

Regarding RM vs Estate Tax. At least the home owners got to spend the equity vs. the government getting more taxes to squander. ;0)