While You're Waiting To Buy, Look Around For A Mortgage

Q.My husband and I want to buy a home as soon as we save a down payment. How can we be sure we can get the mortgage we will need to finance our home purchase?

A. When buying a home, be sure to include a financing contingency clause in your purchase offer. If for some reason, you are unable to get the mortgage you need, you can get your earnest money deposit refunded.

For example, such a finance contingency clause might read: ``This purchase offer is contingent on buyers and property qualifying for a new 30-year first mortgage of at least $100,000 with a fixed interest rate not to exceed 10.5 percent, loan fee not more than 2 points and a monthly payment not more than $914.74.''

Before you go shopping for a home, you may want to pre-qualify for a mortgage at a local bank or savings and loan, subject to appraisal of the home you select. By pre-qualifying, you then will know the maximum mortgage you can obtain and how much down payment and seller financing you will need.

Q. Some time ago, you recommended a good place to find national lenders of reverse mortgages is Modern Maturity magazine.

I agree. The local library had a copy and a contact for all the advertising lenders. However, each plan seems to be different. It is so confusing to a person like me, age 72, in good health, who wants to keep her home, but who needs extra monthly income.

My kids think I should sell my home, since it is free and clear, so I would net over $200,000. But a reverse mortgage would easily give me the $1,000 or so per month extra income I need. Can you give any guidance on the maze of reverse mortgages?

A. Watch out for the so-called lenders who want to acquire your home now and give you a fixed income for the rest of your life. If the home appreciates in market value, they benefit but youdon't, since all you have is a life estate.

Don't hesitate to seek advice from trusted advisers, such as your family, attorney, banker or other person who knows how to evaluate business decisions.

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