If you are getting older, you are likely thinking about where you will live in your retirement years and might also be worried about how you will pay for it. Whether your home is already paid for and you just need to supplement your retirement income or you want to purchase a new home but don’t want a monthly payment and are short on the cash to pay for it in full, this might be an option. Let’s start at the beginning.
What is a reverse mortgage exactly?
With a reverse mortgage, those age 62 and older can have access to an FHA insured loan designed to help them buy their next home or refinance their current home with one initial investment, without having monthly mortgage payments. Though the borrower needs to be the primary occupant of the house, they won’t need to repay the loan until they no longer use the home as their principal residence or fail to meet the obligations of the mortgage.
Because of this leniency, more cash flow can be freed up for retirees to use toward medical expenses and house upkeep, among other necessities. The borrower also has convenient options to access these funds including taking a line of credit, a lump sum, or monthly payout. With the amount of options a reverse mortgage provides, it’s no surprise that more and more seniors are considering it to help them through their retirement.
See how the reverse mortgage can help
When you’re ready to choose a home to spend the remainder of your life in, the idea of taking on another mortgage payment can be daunting, especially during a time where you’re living off a fixed income or retirement savings. Not to mention, you may need access to additional funds to pay expenses like medical care, insurance or other necessities. For some, this means buying the home you love, just wouldn’t be feasible.
That’s where the reverse mortgage comes in.
Who’s taking advantage of it?
So, as an SRES® designated REALTOR®, what does this mean to you? And how can you leverage the reverse mortgage to help boost your business? Studies by the National Association of REALTORS® show that 22% of homebuyers are age 62 and older, the age at which a borrower can apply for the reverse mortgage. Of these homebuyers age 62 and older, 82% are taking out a mortgage on a new home purchase. However, less than 1% of these homebuyers are using a reverse mortgage, even though it may provide a better option for them and their needs.
If you are trying to plan for the future or your future is now, call me and let’s talk about the different options including reverse mortgages that will help get you in the right home for your retirement. Don’t hesitate to ask how I can help you with this and any other real estate questions you might have.
The Chris Wylie Team is your ultimate real estate resource for Houston, The Woodlands, Spring, Cypress, Katy, Tomball and the surrounding areas. Visit our website for for detailed information regarding today’s real estate market.