Reverse Mortgage Blog

A Borrower's story: The Peace of Mind and Financial Flexibility that comes with a Reverse Mortgage.

January 22nd, 2015 | Reverse Mortgage, supplemental retirement income, Retirement Planning, Retirement income insecurity, HECM Reverse Mortgage

This is a classic Reverse Mortgage scenario that contradicts the general public perception that the primary use for a Reverse Mortgage equates to “funds of last resort”.

Recently, I met with a client that was unmarried, in her early seventies, and employed with $300,000 plus in IRA assets.  She currently works two part time jobs, pays a monthly mortgage payment, and is struggling to get by each month balancing her income from social security, the two jobs, and monthly withdrawals from an IRA to make ends meet.  We decided to establish a government insured HECM Reverse Mortgage credit line to eliminate the payment on the existing first mortgage and provide an additional reserve line of credit.  What did this accomplish?

The addition of the Reverse Mortgage injected financial stability into this individual’s life both from a financial and emotional aspect.  She no longer has to take funds out of her IRA to make ends meet.  She can allow her investments to compound tax deferred and take only the required withdrawals.  Further, now that she no longer has to make a principal and interest payment to her lender she can go to work because she enjoys the comradery, not because she has to work.

This is a classic example of how a Reverse can be used to augment a person’s retirement plan to establish financial stability and peace of mind. When you are looking at a life expectancy of twenty plus years this becomes a necessity.

The other option would have been for this person to sacrifice any planning and resort to a reverse mortgage only after all of her liquid assets had been dissipated.  This may have worked as well, but she would not have had the comfort and financial flexibility that she now has as a result of a solid plan.  In other words, it is often more beneficial to have a reverse as part of the plan and not the entire plan.

This is one way the Baby Boomers, tackling the prospects of longevity, can plan and win with a government insured HECM Reverse Mortgage Program sponsored and supported by FHA and Department of HUD.
 

George H. Omilan

President-CEO

NMLS# 873983

Questions/Comments encouraged.

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Jefferson Mortgage Group LLC

2536 Leeds Rd.
Oakton, Virginia 22124
703-319-2198
FAX: 703-773-6946
info@jeffersonmortgage.com
NMLS: 935554

Located in Fairfax County, Virginia. Serving all of Virginia, Maryland, DC & Pennsylvania. 

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Jefferson Mortgage Group LLC is licensed in Virginia, Maryland, DC & Pennslvania.
Virginia State Corporation Commission License Number MC-5659 and the Pennsylvania Department of Banking & Securities #46259 
The DC Department of Insurance, Securities, and Banking License #MLB935554
Maryland DLLR License #21586

An Equal Housing Lender

By refinancing the consumer's existing loan, the consumer's total finance charges may be higher over the life of the loan.

This material is not from HUD or FHA and has not been approved by HUD or any government agency.