Reverse mortgages are good for almost everyone over 62 years old. If you are hearing that they cannot benefit you, then you are hearing wrong.
There are now hundreds of people giving seminars on the benefits of reverse mortgages.....maybe you need to check one out.
It doesn't matter if you own a home, have a mortgage, or EVEN if you are still renting....reverse mortgages can benefit you.
Bob
bob@az62.com
714-331-1486
The life of a senior citizen is one of uncertainty. You are on a fixed income and surprises are around every corner. Unexpected medical bills, family emergencies, or even a new set of windows are just around the corner.
A senior has one of three choices. They can pay for the surprise from their savings, pay for it with an equity loan, or pay for it with a reverse mortgage.
Your savings is your life's work. You have thought long and hard on each decision about savings and now you seem to be tapping that source more and more each year.
An equity loan is a new debt with new payments. This is a monthly payment that reduces your monthly budget each month. This is also a great risk. If you cannot make this payment, YOU LOSE YOUR HOUSE.
The last option is a reverse mortgage. A reverse mortgage sets up a credit line that grows at a great rate. You can tap into the credit line, then watch it grow back to the original amount.
Its a great way to set a boundary for your budget. Leave your savings alone, keep you monthly income the same, and simply use the equity in your home for your unexpected needs. The credit line always grows and eventually replenishes the amount you took out. If you find that you are tapping the account more and more, you will reach a point at which the credit line is gone. Its a sign that you have spent too much money, but not an emergency that will cost your your lifestyle. If this were to happen, you still have your savings, and you can discuss a new plan with a financial expert. You won't wake up one day and find yourself out of a home and out of money.
PLUS: You can always use the credit line as a great place to put your own savings for a rate that is government guaranteed and grows at 1/2% more than your loan interest.
Bob
bob@az62.com
623-214-6663
The AARP research report on consumer satisfaction on reverse mortgages was a landmark study that showed that the general public opinion differs greatly from the opinion of those who are educated on reverse mortgages.
The study found that 93% of of borrowers said that their reverse mortgage has had a positive effect on their lives. Only 3% said it had a negative effect.
Its an amazing figure, but to give it the impact it deserves, lets compare it to other studies of satisfaction and levels of achievement.
On 9/11/2001 George Bush had the highest approval rating of any president in history. Obviously it was a patriotic statement by Americans, but it was still only 92%.
In movies, The Shawshank Redemption, The Godfather, The Lord of the Rings, Star Wars, Raiders of the Lost Ark, and Schindlers List are all tied on approval ratings of people who liked the film. Their approval rating was only 90%
Highest Lifetime batting average in baseball : Ty Cobb 36.7% (.367)
Highest NBA field goal percentage for a single season is : Wilt Chamberlin with 72.7%
It is unbelievably hard to reach a 93% approval rating or rating of any type in any sport, business, or position. The fact that reverse mortgages hold such a lofty approval rating can mean only one thing.
The portion of the American public that has never studied reverse mortgages has a misconception of reverse mortgages. The portion of the American public that understands reverse mortgages LOVE THEM.
Bob
bob@az62.com
www.az62.com
623-214-6663
"I heard"
"Someone told me"
"I read somewhere"
These are the top reasons why kids tell their parents not to do a reverse mortgage. What happened to people doing research for themselves? What happened to looking at facts and looking at the numbers for your own? It just seems crazy to me that people are living their lives on rumors.
I have always wanted my parents to have the best life possible. They were kind enough to raise me right, feed me, clothe me and put me through school. Why would I tell them that a reverse mortgage is not right for them without looking specifically at the numbers that are generated by every HUD approved lender when someone is looking into doing it?
Just take a look at the numbers people. They show you the truth and not what you heard from someone.
Bob
bob@az62.com
www.az62.com
623-214-6663
Whenever you are considering doing a reverse mortgage (and I believe that 90% of seniors would benefit by doing a reverse mortgage), you should watch the three big indicators of what this entitlement will do for you.
1) If you are taking money out, take a look at the loan schedule and see how fast the loan grows, how fast the credit line (remaining equity) grows, and lastly how much you are actually getting. (Remember to account for any payments you are saving from not having to pay an existing loan payment since it was paid off by a reverse mortgage)
2) If you are not taking money out, take a look at the loan schedule and see how fast the credit line is growing. This is the amount that you can take out at any time for emergencies and/or to give a gift to someone. See how long it takes for that credit line to be worth more than your home. (Remember the reverse mortgage is a non-recourse loan, so you can give the entire credit line to your heirs while you are still alive, tax free, and simply turn the house over to the bank after you die.)
3) If your family wants to keep the home after you pass away, and not sell it like most estates are doing now these days, then watch your loan balance. Remember, a reverse mortgage grows at only 1.5% above the 10 year treasury bill. This is the lowest percentage rate in the industry. You can pay the reverse mortgage all the way down to $1,000 before the bank will try to close the account. Emergencies happen. With a huge credit line over time, you will be ready for the emergency. If you don't use the money, your heirs will still have the home and still get the tax deduction for all of the interest you paid. The easiest way to explain this benefit is to remember that a home is your family and not the bricks that make up your house. Getting a reverse mortgage and NOT spending the money is a great way to make sure you are doing the best thing for your family and not just the house.
The three little things to watch are:
1) Service fee....make sure you negotiate your way down to the minimum $25 service fee.
2) Referrals : Does your mortgage company take care of, and actually communicate with its customers after the loan?
3) Annuities : Make sure you do not jump into an annuity with the cash from your reverse mortgage. You should be signing a paper in your loan documents that makes the lender announce any annuity that is included in the loan. Some states have even outlawed this practice. Do not do it under any circumstances.
Bob
bob@az62.com
www.az62.com
623-214-6663
