Maybe. At least that’s the stock answer. There are some circumstances that can work out quite well for some people.
Let’s suppose you are at least 62 years old, and for some reason had to declare bankruptcy, or you got foreclosed, or both. And let’s also suppose that somehow you have a little cash, say 30k-40k put away. Can you buy a house?
Probably! A maligned mortgage option called a reverse mortgage, might work for you. Usually a reverse is used when an older (62+) person has equity in their home, and they want cash. The reverse mortgage lets them get cash out, but not the entire value, and the house reverts to the mortgage company when the owner passes away.
I just sold a home to a friend of mine, and he put about a third of the value of the home down in cash, and got a reverse mortgage for the other two thirds. He doesn’t have to make any payments, although he can, if he wants to ultimately leave the house to someone, or, if real estate values rise dramatically, he can pay off the reverse and sell the house, and keep the profits. Not a bad deal.
The amount and rates are based on the actuarial tables. And it is a much better deal than renting! Just another option for buying a home.
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