Toxic Reverse Mortgage Gobbles up a 94-year-old Widow’s Home Equity
What’s the worst sort of real estate experience you can imagine? How about a mortgage that eventually eats your entire house — your entire equity stake — and leaves you penniless despite years of double-digit appreciation?
That’s been the experience of Katharine Stephens of Brigantine, N.J. In 1988, she and her husband, Harold, signed up for a reverse mortgage that guaranteed to pay them $312 a month for as long as they resided in their house near Atlantic City. At the time Katharine was 76 and Harold was 78. Harold later died, leaving Katharine living alone in the property.