All Adjustable Rate loans have a low "teaser" rate in the beginning, but too often the borrower does not understand that, and they think it will stay the same for the life of the loan. Depending on how the loan is structured, it might change annually, semi-annually or even monthly as is the case with a Line-of-Credit. If the borrower is a senior on a fixed income, they may find themselves unable to afford the increased payments. If they are fortunate to have savings, they might start drawing down on their cash reverses and possibly deplete their cash reserves. A reverse loan should be considered in this situation before they run out of money or enter into default with their Lender.
Tag: interestrates
Adjustable Rate Mortgages
August 31, 2023
Lorraine Jones
