Singapore Reverse Mortgage

SINGAPORE REVERSE MORTGAGE
I read with Interest more and more Reverse Mortgage being proposed. So

here is a video talking about reverse mortgage. The context is for USA, but

the ideas applies for Singapore as well.

WHO?

Reverse mortgage is typically used for seniors allowing seniors to borrow

money against their homes for their retirements. As more and more money

is drawn down, the amount owed to the banks increase.

LONGEVITY DILEMMA

This could be a useful source of money for seniors. However if a senior

takes a 15 year reverse mortgage, but the time he/she reaches 80 years old,

the home may have no more equity left. If he/she lives beyond that age, they

may find themselves out of a home.

OF SANE MIND

There could also be disputes over the state of the mind of a senior when

such reverse mortgage contracts are being signed. Many old folks may be at

risk of being cheated to part with their houses for some "BOGUS"

investments.

ESTATE

At the passing of the old folks, whatever equity is left of the property is

handed down as the estate of the deceased. Whoever inherits this equity

would be faced with the choice of disposing of the asset or let it lapse.

However such mortgages are not yet common in Singapore and therefore

we do not have history on our side to know how banks will structure these

assets on the passing of the old folks.

We believe that as Reverse mortgage becomes more and more popular, there will likely be more lawsuits and a series of social dilemma.

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