No. of Recommendations: 1
ww4321 posts,

I just did a quick calculation for someone taking a $500,000 mortgage and buying a $500,000 annuity for a home in Houston, TX.

e-loan $500,000 mortgage, 30-years fixed at 5.75% = $2,918/monthly payment

Vanguard life annuity for a 65-year-old male, $500,000 premium = $3,257/month benefit.

Increased cashflow = $3,257 - $2,918 = $339/month = $4068/yr.

In Houston, a taxpayer over age 65 can defer his property taxes indefinitely with out penalty (though he pays 8% per annum interest on the unpaid balance, which is recouped when the home is sold or the owner dies.)

On a $500,000 home, property taxes would be $12,000 to $15,000 per year.

I'd do a tax deferral before I'd do a reverse mortgage, or a "roll-your-own" reverse mortgage.


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