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Mortgage Fears, Mortgage Rates


Q. Save me! I am 80 years old and running out of money. I want to get a reverse mortgage on my mansion so I don't have to go to a retirement home, but I'm afraid my greedy kids will kill me so I don't tap into the equity of my house.

A. A retirement home might be preferable to being murdered, don't you think? But a reverse mortgage might help you pay your monthly bills, including a security system to keep out your dysfunctional family. You still have to pay for mansion maintenance, however, so make sure you can afford that.


Q. I have credit card debt coming out my ears. (Okay, so I shouldn't have bought that third plasma TV.) Can I use the equity in my house to borrow money to pay off my cards?

A. Ah, the joys of consumerism. Well, you can most likely get a Home Equity Line of Credit to pay them off, but you are using your house as collateral, so be sure you swear off the cards in the future, or you could end up losing the house. A HELOC seems easy — you have a checkbook to use up to the cap on your loan — and in fact it can almost be too easy if you are a spendthrift.


Q. I thought ARMs are something you hold your sweetie with, and indexes are found in the back of books. I hate acronyms; how can I ever understand mortgages?

A. Time to grow up. ARMs are not necessarily loving, and indexes are found in big stone buildings in D.C. and London. Unfortunately, you need to learn about mortgage types, and how they are structured if you want to get a good mortgage with the lowest rate possible. A good lender should be able to fill you in.

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