Many Baby Boomers have no way to retire. If you have a parent or grandparent still working into their 70’s and 80’s maybe sharing this info with them could relieve the financial stress they experience just trying to make ends meet. I came across a couple living in southern California he’s 83, she is 77, they have lived in their family home for over 30 years and he is still working, despite having social security and two pensions he was working fulltime as a teacher and struggling to stay in their home. I was so surprised by this and their situation and felt I needed to share this. After talking to them about their mortgage and financial future, I recommended they consider a Reverse Mortgage. They had over 700,000 in equity and a reverse mortgage would give them many options so he could quit his job and retire immediately. They had no idea this was an option for them. Hopefully soon they can sit back together on their 5 acre home site and enjoy their remaining years together without the worry of losing their home or being force into selling it.
If you know someone a parent, a grandparent or elderly friend struggling to make their mortgage payments please share this information with them.
Reverse Mortgage is a Home Equity Conversion Mortgage (HECM) They have improved the terms of this loan product over the years and is now insured by FHA. It is a safe alternative for the elderly struggling to get by. They are required to have counseling to be sure they understand the terms. There are several options allowed for disbursement of funds.
If they have a mortgage currently, this loan would be paid off. The remaining equity could be taken in one lump sum or divided up into monthly payments made to the homeowner. There are other payment options but they no longer have a mortgage PAYMENT to make each month. They stay in their home until they move, sale or died. They would be required to pay the HECM loan off when they no longer live in their home, sale it or died. After death their home goes to their heirs. They can refinance or sale and pay off the reverse mortgage keeping any equity profits.
Below I’ve added the link to HUD website you can explore and get more info regarding reverse mortgages. Frequently Asked Questions about HUD's Reverse Mortgage