If you don’t own your home, there is no “American Dream”. Owning their own house has always been the primary indicator of welfare for the Americans, since early 1950’s. But Rick Wolff writes at MR Zine, that present mortgage system is reversing the dream badly. “Traditional mortgages were the crucial means whereby millions of American families changed,” writes Wolff, “especially after World War 2, from tenants to home owners, thereby realizing what came to be known as the American Dream. Today’s reverse mortgages are a new means for liquidating that dream. They would better be described as ‘wealth-transfer’ than ‘wealth-management’ tools.”

Below are some excerpts from this interesting article:

clipped from mrzine.monthlyreview.org
As all statistics show, the only significant asset that Americans accumulate during their working years is their home. �The economic realities of our times now require drawing down that asset via reverse mortgages to fund their post-retirement years. � They will thus not leave their homes to their children. �Meanwhile the mass refinancing of home mortgages by Americans during their working years is also reducing their home equity as they approach retirement. �The combination of refinancing and reverse mortgages is quickly eroding the historically short-lived period of mass home ownership in the US.
No data exist on how many seniors choose reverse mortgages to avoid burdening their children for ongoing support in their final years. �Likewise no data exist on how many of those children will not discover the cost of reverse mortgages until their parents’ estate is debited to repay the reverse mortgage lender. �Yet we know the importance of home ownership to Americans’ sense of well-being.

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