I recently closed a reverse mortgage here in Corona with a popular couple who are nearing retirement. In their 60’s, they both still work, but are looking forward to winding down the time spent on the job and spending more time living their dreams, traveling and making memories. He is a talented artist and she loves to travel and design and sew clothing. They had paid off their home and have some funds invested in a few different investment accounts. As the cost of living has gone up and their employment income has gone down they faced a choice. Do we sell and move to a cheaper, smaller home, or do we stay here where all our memories are, where we raised our kids and had countless family gatherings?
They spoke with their financial advisor and got as realistic as possible. The thought of leaving their home was just too much to bear, but if they actually retired and let go of their paycheck just to rely on social security and their investment accounts they would be drawing down too much and their savings just wouldn’t last long enough. They really did not want to cut back on their lifestyle, some yes, but drastically, no.
Their financial advisor mentioned to them that a reverse mortgage might allow them the flexibility to use their home to stay at home by setting up a large line of credit that they could draw from on the “short” months thereby allowing their investments to grow for the future. That, combined with the fact that the reverse mortgage line of credit would grow as well gave them incentive to keep their budget as tight as possible (because it’s just plain fun to see the line of credit grow each month!) and voila, a plan was created.
They completed their HECM Counseling, applied for the loan and less than 30 days later were signing their final loan documents. Now, they have a large, $289,000 growing line of credit to draw from on the months where they fall a little short. They have their retirement accounts growing for the future, when they are really old. And last, but not least they have the peace of mind that they can afford to retire and enjoy their home and family.
By Deborah Nance
Your Local Southern California Reverse Mortgage Professional
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iReverse Home Loans, LLC, NMLS#810502 originates reverse mortgages in Alabama, Alaska, Arizona (MB-0919584), California, Colorado, Connecticut, Florida, Illinois, Indiana, Iowa, Kansas, Louisiana, Maryland, Massachusetts, Minnesota, Mississippi, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon (ML-5378), Pennsylvania, South Dakota, Tennessee, Texas, Utah, Vermont (1164-MB), Virginia, Washington and Wisconsin.
Important Information: Reverse Mortgages are neither "endorsed" nor "approved" by the Federal Government. The FHA (Federal Housing Administration) provides certain insurance benefits for lenders and borrowers in connection with the lender’s HECM loans; the FHA does not make or originate loans. The owner(s) retain title to the property that is the subject of the reverse mortgage until the person sells or transfers the property and is therefore responsible for paying property taxes, insurance, maintenance and related taxes. Failing to pay these amounts or failure to maintain the condition of your property may cause the reverse mortgage loan to become due immediately. A reverse mortgage is a complex loan secured by your home. Whether such mortgage makes sense for you depends on your financial situation and needs. For these reasons, we strongly recommend that you consult with a qualified independent housing counselor, family members and other trusted advisers before making this decision. This website is not from HUD or FHA and was not approved by HUD or any government agency.