Reverse Mortgage is NOT a swear word! Really! 

I know you are thinking, yeah right! I'm sure we have all heard a horror story or two about this type of mortgage. Reverse mortgages have a stigma because, well, they deserved it. The Reverse Mortgage program began in 1988 and had some less than desirable features. FHA has stepped in and made some drastic changes! These changes are designed to protect the consumer and allow the reverse mortgage to do what it was intended to do, maximize financial stability in your retirement years! 

Top Reasons why you SHOULD consider a reverse mortgage:

  • Tax FREE Money!

  • Does not effect Social Security benefit.

  • Increase monthly cash flow!

  • Never make a mortgage payment! (Yep, its true!)

  • Provides flexible options to access your money. 

  • Remain the owner and keep title to the home.

  • You will never owe more than the home is worth, even if value declines.

  • Heirs can keep the home and pay only 95% of the current value.

  • Heirs can sell or walk away from the home.

  • Use the money for ANY reason. (Go on a vacation, pay off debt, etc)

  • No personal liability for re-payment of the Reverse Mortgage.

  • Loan is guaranteed by FHA.

Requirements of Reverse Mortgage:

  • You must live in the home as your primary residence.

  • Must be 62 Years or older.

  • Continue to pay required property taxes and homeowners insurance.

  • Maintain the home.

 

Nobel Prize winning economist Robert Merton, a finance professor at MIT's Sloan School of Management stated, "Americans have wrongly steered clear of Reverse Mortgages." It would be disingenuous to say that reverse mortgages have not had their issues in the past and were often poorly used. Furthermore, it is a tool that is commonly misunderstood both by consumers and by financial professionals.

While Merton praises the concept of a reverse mortgage, he takes issue with the name itself. "I hate the name. First of all, it’s misleading because saying it’s a mortgage makes it sound like it’s a loan. But with reverse mortgages, you don’t pay anything as long as you stay in the house. So it’s a very different animal. In Korea, he said, it is called a home pension. It is a practical way to use one’s house as a more efficient way to save for retirement.

Merton also explains, “You hear some people say reverse mortgages are bad, I say that a reverse mortgage is a good idea, but maybe we need to fix the design a bit. Let’s fix it if we need to, but don’t get rid of it.” 

Wade Pfau, PHD, professor of retirement income at The American College and director of retirement research at McLean Asset Management and inStream Solutions said, "Reverse mortgages have acquired an undeserved bad rap. I was in the same situation as many advisors of knowing about the conventional wisdom, which is that reverse mortgages are generally a bad idea." After joining a study group on the products, he changed his mind, finding reverse mortgages are a “viable retirement income tool.” 

 

Family misunderstandings between children who expected to inherit a family home when their parents passed away also led to a “negative image that wasn’t really justified,” Pfau said.

Ask yourself this question, "Have I asked the right person, who understands all the ins and outs of a Reverse Mortgage?" Would you go to a Ford dealership and ask them about a Toyota? Of course not.

 

Ashby Financial Group specializes in reverse mortgages and has over 20 years experience in the mortgage industry. We are dedicated to educating seniors about reverse mortgages. We want you to ask questions! We believe knowledge is power. The more you know, the better you understand. Please give us a chance to put your mind at ease! This is a wonderful financial tool for retirement!

We want to answer your questions. Here are some ways:

  • Schedule a FREE consultation and meet one-on-one with us.

  • Talk with us on the phone

  • Text us all of your questions

  • Email us your questions

Contact Us!

Ashby Financial Group, LC

326 Apricot Grove

Kaysville, Utah 84037

801-294-6179 - Office 

801-455-1007 - Bryan Mobile Phone