Scenario: Borrower and her husband have lived in their home for decades. Their mortgage is almost paid off. However, her husband has been battling early dementia and it’s getting worse. She’s coming to grips with the reality that he will soon require a residential senior care facility.
PROBLEM: She has some savings and investments. With a tight budget, these investments would have sustained them for over a decade of retirement. However, the costs of her husband’s impending medical needs would blow through those assets in less than a year, leaving her penniless.
Diagnosis: While this borrower’s liquid and retirement assets are limited, she has a significant amount of equity in her home that could be used to fund her husband’s needs. Other than social security, she has no other income. She cannot qualify for a traditional mortgage. She cannot sell her home. Where would she go? She must stay close to her husband!
Solution: Performed a complete financial analysis to confirm the borrower’s financial resources, her budgetary requirements, her lifestyle needs, and her future plans for her home. Consulted with the borrower’s financial advisor and estate-planning attorney. Determined a Reverse Mortgage would allow this borrower to convert her equity into a tax-free monthly stipend which she could use for living expenses and to fund her husband’s residential facility. This monthly stipend would continue for the remainder of her life, insuring her husband would receive the care he needed, that she could remain in her home and close to her husband, and that paying for her husband’s care would not leave her destitute.
Result: Enormous emotional relief and a huge financial burden lifted from her shoulders.
BOTTOM LINE: A Reverse Mortgage is a wonderful tool and can be a life saver for some seniors. But they are NOT appropriate for everyone.
In order to confirm whether a Reverse Mortgage is right for you, to ensure a Reverse Mortgage is used correctly, is complementing your financial plan, is helping you to preserve your wealth, and that a Reverse Mortgage will sustain your retirement, you MUST utilize competent and qualified financial professionals. Only entrust your time, money, and mortgage to a seasoned, professional, and Certified Mortgage Planning Specialist® with a proven track record.
Warren Goldberg is President of Mortgage Wealth Advisors, a Certified Mortgage Planning Specialist®, and a published author. His interviews include Blog-Talk Radio, Newsday, The Daily News, Anton Press, and the Long Island Herald. Since 1992, he’s been sharing his financial knowledge and wealth-building strategies, including how to properly use your mortgage as a financial tool. His clients regularly express their trust and appreciation by recommending friends and family call when in need of mortgage, real estate, and financial guidance.
This material is not from HUD or FHA,
and has not been approved by HUD or a government agency.
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