With the recent spate of interest rate increases, many people who took reverse mortgages through the major banks several years ago are now paying well in excess of 10%.
Fortunately, there are many other lenders who currently offer much cheaper rates, and crucially, no monthly fees. Now is a good time to investigate these options if you think you are paying too much. You might be surprised to learn how much more you could pay over time if you’re stuck with the wrong lender.
As an example, if you borrowed $100,000 as a reverse mortgage loan, based on the current difference in the rates charged by the banks, you would pay over $100,000 more in interest and fees over 20 years with one lender, compared to one of the cheaper alternatives.
Are you paying too much? Check your loan here
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I was unsure whether it would be worthwhile changing from my variable rate loan with one of the big banks. Fortunately the man from Seniors First showed me how much I could save with lower interest rates and no monthly fees. It worked out to be a saving of more than $6,000 over 5 years. They certainly gave me the right advice.