QUESTIONS?

CALL US: 703-319-2198


Reverse mortgages: Useful retiree tool or bad move?

Published on Nov 17, 2015 | Reverse Mortgage Retirement Planning Government insured mortgage Home Care Financial Planning

Great article.  I agree that a Reverse Mortgage is best used when it can augment an existing retirement plan.  However, in many cases where that may not be an option, there is still room for ample benefit.  I would also like to add some clarity on the growth of credit for retirees and seniors so it is more easily understood.  When a homeowner is in a position to utilize a reverse mortgage where they have a substantial amount of available home equity (“principal limit”) over and above any mandatory payoff items like existing mortgages, the credit line growth factor within the government insured HECM Reverse Mortgage can provide a major benefit that should not be overlooked.  This can provide a significant benefit looking out only five to ten years and especially for cases where people are planning for thirty years of retirement.  For example, when someone pays off a mortgage(s) they increase their tangible monthly cash flow for living expenses. Beyond this, any untapped residual principle limit or otherwise termed available home equity will compound resulting in increased available credit each year as the homeowner ages.  In this scenario, if you use a Reverse Mortgage to help manage your monthly cash flow and preside over your remaining home equity very conservatively, using it only when absolutely necessary, you will position yourself to get the most out of the loan.  Don’t underestimate the power of compounding.  Get the numbers in your favor to win.  To summarize, use a Reverse Mortgage to pay off debts to balance cash flow and preserve your remaining available home equity so you can lean on compounding growth of the credit line for security. 

http://www.cnbc.com/2015/10/26/reverse-mortgages-useful-retiree-tool-or-bad-move.html#comment-2344877045

 

George H. Omilan
President-CEO - NMLS# 873983
Jefferson Mortgage Group LLC
Helping seniors with Reverse Mortgages in Virginia, Maryland, DC and Pennsylvania.

Questions/Comments encouraged.

 

Recent Posts

Blog Tags

Reverse Mortgage HECM Reverse Mortgage Retirement Planning supplemental retirement income Seniors Retirement security Financial Planning Short Sales Age in Place Government insured mortgage lifetime income with a Reverse Traditional Mortgage Home Care HECM for Purchase Retirement income insecurity solutions for underwater properties home equity access Long Term Care Jumbo Reverse Mortgage Social Security reverse credit line Mortgage Loan Process Eligibility for Reverse Mortgage Specialized Forward Mortgages Financial Assessments Annuity forgiven mortgage debt mortgage Inflation foreclosure cashflow FHA Debt Mitigation 55+ mortgage debt forgiveness act Real Estate Investment Loans self-employed borrower VA LOAN HUD private label reverse mortgage Non QM Reverse to Purchase Mortgage Loan modification Investor Loans No Doc Investor Loans Real Estate Market VA Low Score Jefferson Mortgage Group bank statement loan Housing Market investor financing Mortgage Rates Medicare Sandwich Generation Interest Rates QM HECM Changes High-Value Homes LESA HECM to Purchase Senior Advocate mortgage debt Reverse Mortgage Eligibility Low Credit Score manual underwrite Construction Loan Fed Real Estate Economy 2023 changes growth factor downsizing HELOC Hard Money Loan Lending Limit increase DSCR 2025 changes mortgage debt relief act Mortgage Deliquency Non-recourse loan modify your loan with your lender Business Cash-flow Fiscal Cliff ATR Rule assisted living LLC Asset Based Mortgage Blanket Loan Seller Contribution Jumbo Reverse Second Trust Diversification Estate Plan Senior Care Rentership Credit Score down to 500 Second Trust Gray Divorce Jumbo Mortgage Loan bankruptcy MIP Unrestricted Approval Trump Principal Limit Factor success story 2021 Changes Debt Treasury Commercial Real Estate FINRA Housing Prices Property-based loan occupancy requirements Asset Qualifer Second Trust Prequalification Non-Qualifying Loan