What is a reverse mortgage? It is no longer considered the loan of last resort. The reverse mortgage loan of today allows borrowers to convert the equity in their home into cash. This cash is usually tax-free and there are no required monthly mortgage payments. This is a loan that is taken out against the senior’s home equity, and is typically repaid in one lump sum when the last borrower leaves the home permanently. The loan does require the borrower to continue to make payments for property taxes, homeowners insurance, and maintenance (i.e. HOA fees if applicable).

Reverse Mortgage Loan FAQs

Why Would I Consider a Reverse Mortgage?

  • Remove required mortgage payment
  • Be proactive not reactive to cash flow challenges
  • Bridge the Medicare gap from 62 - 65
  • Have funds for when an accident / illness occur
  • Stop working –either part time / full time
  • Relief from financial stress
  • Allow assets in your portfolio to grow / stay invested
  • Let the house pay for itself – repairs / taxes / HOI / HOA
  • Fund your Long Term Care
  • Use funds to gift to family while you are alive and see the joy & benefit it provides
  • Use funds for grandchildren’s college
  • Remove expensive credit card debt
  • Funds available are non-taxable
  • Donate to your favorite charity
  • Have funds to travel
  • Standby cash reserves
  • Downsizing – use this loan to buy a new house
  • Supplement your invested assets with another source of funds
  • Age in place
  • Loan act as if you own it free and clear
  • Use as a strategy amidst gray divorce
  • Potential tax strategy to reduce capital gains

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To learn more about reverse mortgages, please contact our designated reverse mortgage planner, Desiree Yuzawa.