For many who remember the reverse mortgage scares of the yester-years, the terms ‘comfort’ and ‘reverse mortgage’ seem like an unlikely duo. But they shouldn’t be.
Since the FHA and HUD changed a few regulations stabilizing HECM reverse mortgages in 2015, they have quickly been garnering new attention. Whether looking to boost monthly income, protect retirement, or even purchase a new home, reverse mortgage is proving to be a versatile and creative tool.
Here are three ways a reverse mortgage can help make retirement more comfortable:
1.) Supplement retirement income. With a whopping 36% of baby boomers planning to live on nothing but Social Security for retirement, utilizing a reverse mortgage to supplement retirement funds with non-taxable income from the equity of an individual’s home is a great option. The funds can be accessed via monthly payments or a line of credit, and because the loan doesn’t come due until the borrower passes away or permanently leaves the home, they can live their retirement years both financially comfortable and in the comfort of their own home.
2.) Protect and enhance retirement portfolio. For those who have a well prepared plan for their retirement, using a reverse mortgage line of credit to supplement their nest egg can offer great flexibility and even enhance wealth. Some simply want to use the funds to delay Social Security until they can receive the largest amount. Others may have investments they are looking to protect or allow to mature. Retirement and financial planners are now discussing how a reverse mortgage can be used as part of a long term retirement plan.
3.) Purchase a retirement home. It’s still a little known fact that a reverse mortgage can be used to purchase a new home – but it can, and it’s a great fit for so many retirees. Whether looking to moving into a senior community, move closer to family, or move to a dream home, using a Reverse Mortgage for Purchase should not be overlooked. This amazing program makes the once impossible possible when it comes to home buying.
Reverse mortgage is an individualized, specialized loan for those 62 and over that allows older homeowners to tap into the equity of their home while living mortgage and loan payment free. The funds can be accessed via a lump sum, line of credit, monthly installments, or even to purchase a home. If you are planning ahead, let an experienced reverse mortgage advisor guide you and help creatively suit your needs and desires.
Sara Cornwall is a local Reverse Mortgage Advisor serving the entire state of Connecticut. Contact Sara and learn if reverse mortgage is right for you.