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Credit expert says reverse mortgage might be good idea

PHOENIX -- If you're nearing retirement and wondering how you're going to live on limited income, you may be able to use your home to get some much-needed cash.

By getting a reverse mortgage, homeowners can convert part of the equity in their home into cash. Instead of the owner making monthly payments to the lender, the lender pays the homeowner.

Most of the time, older homeowners will use the money to pay medical bills or routine everyday expenses.

"You would take that cash, and you would have it and not have to repay it until you either move out of the house or die," said Mike Sullivan of Take Charge America, a credit counseling service.

The lender will get repaid once the homeowner either sells the home or no longer lives there. Sullivan said that if you're over 62 and have a limited income, a reverse mortgage might be a good option.

"If you have to have money to live on, and you don't have any other source of money, then, as I always say, 'This is certainly better than eating dog food,'" Sullivan said.

Sullivan added that if the homeowners aren't careful, however, they could still lose their home to foreclosure, if they don't stay current on other payments, such as insurance and property taxes.

About the Author


Years with the company: I started on January 2, 2006.

Education: I was born in San Antonio, Texas, but we moved to Phoenix when I was one-year-old in 1957. I grew up here and graduated from Alhambra High School and attended Phoenix College.

Family: I live in north Phoenix with my wife Rene' and my son Devin.

Favorite food: Lots of favorite food, but our favorite restaurant is Fajitas.

Favorite spot in Arizona: The Little America Hotel in Flagstaff.

Favorite news memory: We have to go back to October 15, 1979. I was a country music air personality at KROP Radio in Brawley, California, when we had a 6.7 earthquake. Thankfully, there were no deaths and only minor injuries, but the entire community was pretty freaked out and listening to the station on their transistor radios. I would not want to go through an earthquake again, but it sure was a great night to work in radio and see how it can make a difference in people's lives.

First job: Working as a stringer for 'The Arizona Republic' at high school football games. My first real job was flipping burgers at the old Sandy's Hamburgers at 51st Avenue and Indian School Road. My first radio job was as announcer at KALJ radio in Yuma in 1977.

First concert: My Dad took me to see Jimmy Dean at the Arizona State Fairgrounds in the 1960's. It was before the Coliseum was built. The only thing I remember is Jimmy Dean singing his big hit "Big Bad John."

Favorite sports team: Phoenix Roadrunners minor league hockey. My dad took me to a game when I was in grade school, and I was hooked. I wanted to be a radio hockey play-by-play man. I used to take my cassette recorder and sit up in the rafters of the Coliseum and do play-by-play. It was great later in life to also take my son to Roadrunners games. Too bad the team just folded, I'll miss them. (Going to the Coyotes is fun, but they're not "my" team.)

Outside interests: My family and I are active in our church - Shiloh Community Church in Phoenix. Devin is a high school student at Scottsdale Christian Academy. He plays on the baseball, football, and basketball teams and sings in the choir. Obviously, we keep busy trying to go to all his events! We enjoy going to movies, sporting events, and long road trips. We like to vacation at the Beach Cottages in the Pacific Beach area of San Diego. And I love to play catch, basketball, football with my son.

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