Reverse Mortgages

If you’re 62 or older and want to supplement your income, pay for healthcare expenses or have more financial freedom in your retirement years, consider a reverse mortgage. As the name implies, a reverse mortgage provides you with cash by accessing your home’s equity, without having to sell it. It provides that cash as regular monthly payments or as a lump sum.

Reverse mortgages have been around for decades as a way for older homeowners to get the additional income they need. To many, the most attractive benefit of this loan product is that you only have to repay when you leave your home. As long as you maintain your home and pay associated home fees such as taxes, homeowners insurance and HOA fees, you will continue getting payments.

In addition, a reverse mortgage is a “non-recourse” loan. This means that neither you nor your estate will ever owe more than the value of your home when the loan eventually becomes due and/or the home is sold.

The group of solder adults who are most likely to benefit from a reverse mortgage includes:

• Those looking to supplement a fixed income retirement.
• Those who need a home equity line of credit (HELOC).
• Older adults who want to remain in their home for the long term.
• Those looking to use a reverse mortgage as a financial tool in their retirement plan.

Homebuying with a Reverse for Purchase 

For older adults interested in moving, a reverse mortgage can even be used to buy a new home. Using a reverse mortgage in this way is called a Reverse for Purchase. It allows our customers to buy the “rightsized” home of their dreams – one that fits their changing lifestyle.

Some of the qualifications include:

• At least one borrower must be at least 62 years old and occupy the home as primary residence within 60 days of closing.
• Demonstrated ability to pay ongoing property tax, insurance and possible HOA dues.
• All borrowers, non-borrowing spouses, and attorneys-in-fact must receive counseling, and the Counseling Certificate must be available prior to  application.

Benefits of a Reverse Mortgage

Here are four other ways a reverse mortgage can improve your retirement income plans.

Deferred social security benefits. Defer social security benefits by setting up a reverse mortgage with a term payout that ends when you receive your social security payments.

Make improvements to your home. If you need to make some renovations, but your cash is tied up in the house itself, a reverse mortgage can give you that funding.

Remaining in the comfort of your home. Reverse mortgages help older adults who are “house-rich” retire and stay in their homes for as long as they’d like.

Extra funds for unexpected expenses. Having access to a reverse mortgage line of credit could give you peace of mind should you have unexpected expenses.

A reverse mortgage can be a crucial component in your retirement planning. Contact me today to learn more!

There are four basic requirements to qualify for a reverse mortgage:

• At least one Homeowners must be 62 years of age or older.
• The home must be your primary residence.
• The house must be a single family residence (up to 4 units), condo, or manufactured home.
• The type of home and the condition must meet standard HUD guidelines.

Some of the uses of a Reverse Mortgage are:

• Purchase a home
• Eliminate an existing mortgage payment (borrower is still responsible for taxes & insurance)
• Create additional monthly income
• Have cash for home improvements, or payments of credit cards or medical bills
• Have readily available access to a line of credit that grows in value over time.