The Mortgage Porter

Seniors Facing Financial Whammy Should Consider a Reverse Mortgage

From the front page of Monday's Seattle PI: Seniors face financial 'quadruple whammy'.

The article features  a photo Seniors in line at the West Seattle Food Bank and begins with this sentence:

"Like many retirees, Wilma Johnson notices the price of everything in Seattle going up while the interest on her savings is flat to dropping.

"I told my cat she's going to have to go out and catch her own food," the 86-year-old Broadview homeowner said.

With a reverse mortgage, seniors qualify based on their home equity and their age (62 years  old is the youngest allowed on title) and can receive either monthly payments, a lump sum of cash or a home equity line of credit that they can draw on when needed.  If a Senior owns their home and has enough equity, there is no reason for them to struggle financially during their golden years.  Reverse mortgages do not require income or credit for qualifying.  It's definitely worth consideration when it can improve quality of life. 

Wilma, your cat doesn't need to catch her own food--consider a reverse mortgage. 

Reverse Mortgages allow Seniors Quality of Life

Last Sunday's Seattle Times featured an article by David Ranii: Seniors move forward on reverse mortgages.  Reverse mortgages provide tax free income by accessing the equity in the Senior's home.  There are no credit or income qualifications, the youngest on title must be at least 62 years old.    Seniors can either receive monthly equity payments, a lump sum of cash or set up an equity line to draw on without mortgage payments.   Loan amounts are factored by how much equity is available in the property and the Seniors age. 

Many do not save enough for retirement and a reverse mortgage could be a great resource to help a senior enjoy their golden years.   In the Seattle Time's story, 86 year old Trudy

took $2,000 in cash up front and established a line of credit that enabled her to withdraw an additional $3,000 last year — money she used to fix her roof, among other things.

Trudy's son suggested the reverse mortgage which has allowed her to stay in her home.   Trudy says

"The reverse mortgage is a big help".

Related post:  Does Santa Qualify for a Reverse Mortgage?

Does Santa qualify for a Reverse Mortgage?

If Santa and the Mrs. would like to add a steady tax-free income each month while he's volunteering, making toys and traveling around the world, he may want to consider how a Reverse Mortgage could benefit their lives.

Reverse mortgages can be a financial tool for Seniors who would like to have access to additional funds.   A reverse mortgage is essentially a loan against home equity for borrowers who are at least 62 years old.

Unlike a traditional mortgage where you make monthly payments, a reverse mortgage pays from your equity.   Instead of paying down your balance every month, your loan is actually growing as it provides tax free income to the Senior.  The mortgage is paid off when the last senior leaves the home.  Here is a calculator to see how much cash you may qualify for utilizing a reverse mortgage.

Reverse mortgages are easy to qualify for as long as their is enough equity in the property:

• Youngest borrower must be 62 years of age or older.
• No income or credit score requirements.
• Counseling is required from a HUD approved agency (no cost to the borrower).
• Property must be the primary residence.  (It does not need to be mortgage free).

In addition, reverse mortgages are non-recourse (the borrower can never owe more than the appraised value).

Santa and Mrs. Claus can use a reverse mortgage to:

• receive a lump sum of money (with no payments due until the last borrower leaves the home).
• receive a monthly tax free payment.
• purchase a primary residence.

The money can be used for anything they wish from bridging the financial gap between what they planned for retirement and the reality of retirement to vacationing or what's on their Christmas list.

I'm pleased to be able to offer Reverse Mortgages and the Family Opportunity Mortgage programs both designed to help Seniors. Questions?  Please contact me or your local Mortgage Professional.