[dennis in se pa]

Yes, this has been covered, but a search turned up posts from long ago, and I wanted to make sure everyone knows this is a scam on elders that should only be used as a last recourse.

I wanted to educate myself in this area in case the need was to arise, hopefully it won't. A hypothetical home worth $200K would net a $120K payout or about $600 a month. There is more to it, but the closing costs are what scare me. In the case I was looking at the "origination fee" - what they get paid for just doing the paperwork - was $3000!!!! And the mortgage insurance was $4000!!!! WTF!!!! Around here mortgage/title insurance on such a property would be closer to $1500 or so.

My point is that this is a scam to suck cash from elderly people. Why is this not better regulated so the banks can only charge reasonable fees such as $1000 origination and standard mortgage insurance rates? Because the banks are among those who run our so called democracy.

A point on mortgage/title insurance. In my experience this is another scam from the banking industry who are in bed with the title insurers. You can go to the court house for free and see if there are any liens against a property you are buying. That is all your several thousand dollar title insurance policy will protect you against, and you won't get title insurance if there are liens that can't be immediately resolved. So your title insurance is worth NOTHING. But you have to buy it to get a mortgage. Hmmmmm....

There may be rare exceptions to this scenario, which I imagine those in the title insurance industry will jump on, but for the most part this is my experience. IMHO YMMV etc.