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Stay alert for unexpected expenses for your reverse mortgage

When you contact a person who deals with such activities, or probably go to a website in case you wish to get some nice deals on some reverse mortgage facilities, there is a whole lot of stuff thrown back at you regarding the necessities and the profits of getting involved in a reverse mortgage, yet no one clearly tells you the exact process and guidelines of how to about it, starting right from the application to the amount of fees expected out of the consumer. A person who wants to apply for reverse mortgage deals is always unclear and vague, his mind filled with questions regarding the processing and the fees and expenses that will be levied on him and by him. An uninformed customer is usually and most of the times, taken in for a shock and surprise when he is asked to just keep paying amounts at every step of processing, amounts of which he was never informed or told to pay initially before he started off with the application of the reverse mortgage deals. Reverse mortgage deals, if done properly and through the right set of people and brokers, can prove extremely beneficial for customers. But such loopholes of just extracting and exploiting uninformed and vague customers turn out to be an unpopular growth of reverse mortgage deals, which needs to be eliminated immediately.

So as a customer, if you are in search of the best deals for your reverse mortgage, always remember to make an informed decision. Before you start the application process with your selected broker, make sure to ask him and demand him to inform you for the exact and necessary expenses that would be expected out of you, so that before you make and confirm the deal, you already know how much you will be spending out as your expenses. Ensure that the reversible mortgage broker or lender is clear cut of the amount you will have to shell out and the types and kinds of expenses that you will need to go through. The information of the expenses is important for a customer so that he or she knows how much they will be spending before even signing or confirming the deal with the brokers. You wouldn’t want to be spending a few pennies each and every time, after every step of the process if you were initially not ready to. The problem uninformed customers face is that they get burdened by such decisions.  In order to get the best deal, make it a point to ask the broker each and everything, right from the fees to the profits so that you know what you are doing and deciding on is right.

There are primarily two types of brokers existing in major cities like Ontario and Toronto. They are Seniors Money and CHIP. So before you decide on a particular reversible mortgage deal, make sure to do a cost comparison between these two major types of brokers in Canada, as it will give you a clear idea of the better and bigger deals for yourself. Seniors Money includes an initial setup fee of about $1275, including the costs of a third party appraiser. Also, if you are willing to invest an additional amount of $295 which is a onetime fee, they also offer their customers with an Equity Protection Option, wherein certain amount of equity of the customer remains in the house, as protection. Top-up Options available with Seniors Money are at $95 per advance. Comparing it with CHIP, they have an initial set-up fee of $1485, which is way higher than Seniors Money, taking into account the fact that the set-up fee does not cover the costs for a third party appraiser. CHIP requires the customer to pay for their own home appraisal, with the amount being anything between $175 to $400. Also, there are no Protection Options or any other additional offers provided by CHIP, making Seniors Money a rather well advantageous choice for your reverse mortgage deal.

To ensure that you have a proper legal counsel behind your back explaining the rules and regulations after each deal, both CHIP and Seniors Money require their customers to get an independent and professional lawyer for themselves in order to close the deal. It is extremely necessary for the customer to get acquainted with the rules and regulations, and that their lawyers are there to explain them the application and consequence of each and every rule before closing a reverse mortgage deal, so that there are no questions or doubts later after getting the deal closed. Understand the mortgage contract and deal is essentially important, and therefore customers are required to sign the necessary documents in presence of their lawyers.

The extra amount that you will have to shell out for such legal lawyers and advisors could be anything between $200 to $700. Also, the best way to go about the whole reverse mortgage application process is to pay all the fees from your own pocket. You also have an option to add some extra expenses to the mortgage debt and pay only your legal and appraisal fees in case you are trapped in for your cash, but doing so will unnecessarily add up to larger amounts along with interest, which you will eventually have to pay later on in the future. In order to avoid a situation like this, always know, research and compare the total costs you would be expected to pay to the brokering companies. For example, the total reverse mortgages costs could range from $1800 with Seniors Money and $2300 with CHIP, which include all your legal and appraisal fees as well. Therefore, always ask the broker to give you an exact estimate of the fees and types of expenses, so that you know you have the required amount of cash in your hand to make the deal, if not, then you will have to pay off the debts with interests at a more expensive level.

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