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#287: Using a reverse mortgage to add granddad quarters

MAKING ROOM FOR DAD USING A REVERSE MORTGAGE

Since your mother passed away, Dad’s health has been a bit iffy. While he’s still able to drive and take care of his basic needs, you worry about him constantly. As a widow now retired from full-time work, you stay in touch with your father daily, but it’s still quite burdensome to make the two-hour drive to visit him regularly. Meanwhile, both of your adult children live in other states, with jobs and families of their own; neither can reasonably visit their grandfather on a consistent basis.

You’ve been exploring various assisted living facilities near to your home but now are thinking of building an addition onto your own house to create an apartment for Dad. Fortunately, there is sufficient space on the property to accommodate such an addition with a separate entrance, yet allowing access to the lower floor of your own living quarters. You’ve spent the last two months getting proposals from builders, even researching the zoning laws. 

Your father is amenable to the move and offered to help pay for the renovations. However, while you will allow him to contribute to the upkeep of the home, you know his finances are not set up for a large lump sum commitment. You’ve been considering different options for financing the structural addition and the furnishing of the apartment, perhaps cashing in some investments and taking out a second mortgage (your first mortgage was paid off with the proceeds of your late husband’s insurance policy). 

You’re certainly not alone in exploring multi-generational living. A recent survey revealed that “Americans are twice as likely to consider moving elderly relatives under their roof that to explore retirement homes”. However, instead of cashing in investments or taking out a second mortgage, you might consider tapping into your home equity in a different way, using a reverse mortgage. 

By deploying your own “housing wealth” using an FHA-insured HECM Adjustable Rate Loan line of credit, you’ll be able to draw down the amount needed to finance the reconstruction work. You’d continue to pay real estate taxes and insurance (on the newly appraised value of the home, of course), but there will be no monthly mortgage payment* due. Meanwhile, any unused portion of your equity will be credited with non-taxable growth at the same rate as that being charged on borrowed funds.

                   A reverse mortgage might prove to be the key to making room for Dad.

https://mutualreverse.com/david-garrison

*Borrower must occupy home as primary residence and remain current on property taxes, homeowner’s insurance, the costs of home maintenance, and any HOA fees.

David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.org

Equal Housing Lender

#286: Using a reverse mortgage to pay for Bar/Bat Mitzvah bash

DANCING THE HORA USING HOME EQUITY

After a health scare a couple of years ago turned out to have only a minor impact, you reevaluated your plan to sell your home and move into a new, upscale retirement community in northern Indiana. Emotionally, it felt simpler to stay put in the home you’d owned for decades. Now, entering your seventies, you’re glad you made the decision to “age in place” in favor of the familiar. (That choice even freed up extra dollars for travel.)

Early next calendar year, with your twin grandchildren—a boy and a girl—turning 13, you’ve decided to organize and host a family reunion around the occasion of their Bar and Bat Mitzvah. After speaking with the rabbi and gathering cost estimates for hotel accommodations, catering, and other expenses, you realize the financial commitment would require liquidating portfolio assets to an uncomfortable degree. You’re still determined to proceed, but you begin considering whether to apply for a home equity line of credit—something you used years ago to help finance upgrades to your home after deciding to stay.

You might also consider an alternative way to tap your housing wealth: arranging a reverse mortgage line of credit on your home and using taxfree* withdrawals to help cover the cost of the family celebration. With no requirement to make monthly mortgage payments,** you can move forward with your plans without concern for ongoing cashflow obligations. Meanwhile, the unborrowed portion of your available housing wealth is guaranteed to grow at the same rate as the interest charged on the borrowed funds.

By using a reverse mortgage instead of a traditional home equity line of credit, you can have the whole family saying “Mazal Tov” and dancing the hora in style alongside the Bar Mitzvah boy and Bat Mitzvah girl.

https://mutualreverse.com/david-garrison

*Please consult a tax advisor.

**Borrower must occupy home as primary residence and remain current on property taxes, homeowner’s insurance, the costs of home maintenance, and any HOA fees.

David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.org

Equal Housing Lender

#285: Using a reverse mortgage to finance car purchase

HOME EQUITY ENABLES GETTING AROUND WHLE STAYING HOME

 

While you’re feeling the crunch of higher living costs along with everyone else, you’re both feeling secure in your decision to spend your retirement years at home (you retired two years ago, your husband at the end of last year). Over the past two years, you oversaw a modest home remodel and an update of your heating and cooling systems – all with no borrowing, you’re proud to share. 

The recent spike in gasoline prices has turned your attention to the two vehicles you own, and you’ve discussed replacing them with small electric cars. Unlike most of your female friends (and, to a certain extent, your spouse), you have never been afraid of gadgetry or technology, and the timing certainly seems right to “convert”. On the other hand, you are uncomfortable with either cashing in investments (for both tax reasons and to preserve regular cash flow in retirement) or with taking on debt repayments just as you’re “settling into retirement.

You might consider tapping into your “housing wealth” to finance the purchase of electric vehicles (and the charging station), by applying for a HECM reverse mortgage. Of course, you’d continue to be responsible for property tax, insurance, and maintenance, but there will be no required monthly mortgage payments.* (If, in fact, you find the savings on gasoline significant in terms of your budget, you may choose to “infuse” cash into the account.) Meanwhile, any unused portion of your equity will be credited with non-taxable growth at the same rate as that being charged on borrowed funds.

In a move to help combat the rising cost of gasoline by switching to electric cars, your home equity can help enable you to “get around” while “staying in place”.

https://mutualreverse.com/david-garrison

*Borrower must occupy home as primary residence and remain current on property taxes, homeowner’s insurance, the costs of home maintenance, and any HOA fees.

David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.org

Equal Housing Lender

Why Retirement Planning Needs More Than a Financial Plan

For decades, retirement planning has centered around one essential question:

Will I have enough money?

It’s an important question—but it’s no longer enough.

Today, many people will spend 25, 30, even 40 years in retirement. That’s not a single phase of life. It’s a long stretch filled with transitions, decisions, and changing priorities.

And many of the most important decisions have little to do with investments.

They’re about how you want to live.

A Longer Life Changes the Conversation

Living longer is one of the biggest shifts happening today.

But a longer life doesn’t just mean stretching your savings—it means navigating new questions over time:

  • Where do I want to live as I get older? 
  • How do I stay active, independent, and engaged? 
  • What happens if my health changes? 
  • How do I support a spouse or family member if needed? 
  • What gives me purpose once work is no longer central? 

These aren’t one-time decisions. They evolve over decades.

Which is why retirement planning is becoming less about a finish line—and more about an ongoing strategy.

The Missing Piece: Support Beyond Finances

Most financial plans are built to handle numbers:

Income, expenses, investments, risk.

But life doesn’t happen in a spreadsheet.

At some point, nearly everyone faces situations like:

  • Retiring and wondering what comes next 
  • Deciding whether to stay in their home, downsize, or relocate 
  • Navigating a health change—for themselves or a loved one 
  • Adjusting after the loss of a spouse 
  • Wanting to make the most of their healthy, active years 

In these moments, financial advice is only part of what’s needed.

People also need guidance, resources, and support.

What Is a “Longevity Network”?

A longevity network is simply a group of trusted professionals and resources that help you navigate the non-financial side of a long life.

Think of it as a support system that evolves with you over time.

Depending on your situation, that might include:

  • Health and wellness professionals 
  • Retirement or life transition coaches 
  • Housing and downsizing specialists 
  • Medicare or long-term care experts 
  • Caregiving resources 
  • Community and social opportunities 
  • Technology and safety guidance 
  • Travel and lifestyle planning 

You may not need all of these today.

But over time, many become important.

Where Your Home Fits Into the Picture

For most people, their home plays a central role in their retirement plan—financially and emotionally.

It’s not just where you live. It’s also:

  • Your largest asset 
  • A source of stability and independence 
  • A potential tool for flexibility as life changes 

As you think about the future, questions around housing become critical:

  • Will your current home still meet your needs in 10–20 years? 
  • Would you prefer to stay, modify your home, or move? 
  • How important is proximity to family, healthcare, or community? 
  • Could your home equity help support your lifestyle or care needs? 

There’s no single right answer—but there are more options today than many people realize.

Why This Matters Now

The reality is:

  • People are living longer 
  • Life is becoming more complex 
  • And the decisions don’t happen all at once 

Having a plan for your finances is essential.

But having a plan for your life—and the right support along the way—can make just as much of a difference.

A More Complete Approach to Retirement

The goal of retirement planning isn’t just to make your money last.

It’s to help you live well over time.

That means thinking about:

  • Your health 
  • Your home 
  • Your relationships 
  • Your sense of purpose 
  • Your ability to adapt as life changes 

And making sure those pieces work together.

Final Thought

Living longer is a gift—but it also comes with new challenges and decisions.

You don’t have to navigate those alone.

The right plan—and the right network of support—can help you make the most of the years ahead.

Because in the end, it’s not just about adding years to your life.

It’s about adding life to those years.

The New Silver Economy: How Home Equity Is Reshaping Retirement

Retirement security in America hasn’t improved much in recent years. While savings rates have ticked up slightly, confidence levels remain flat. Many people are still facing the same concerns: rising costs, market volatility, and the very real fear of outliving their money.

But beneath the surface, a different story is unfolding.

A Contrarian Shift Is Happening

For decades, retirement planning focused on accumulation, preservation, and often downsizing. Spend less. Save more. Stretch what you have.

That model is starting to break.

Today, a growing segment of retirees—particularly homeowners—is taking a different approach. Instead of relying solely on savings and investments, they’re tapping into housing wealth to create flexibility, liquidity, and control.

In other words, they’re treating their home not just as a place to live, but as a financial asset that can actively support their lifestyle.

From “House Rich” to Lifestyle Rich

This shift is fueling what many are calling the “Silver Economy.”

As home values have risen, trillions of dollars in equity have accumulated among older homeowners. And rather than leaving that wealth untouched, more people are beginning to use it.

That capital is being deployed toward:

  • Travel and life experiences 
  • Private healthcare and wellness 
  • Supporting family members 
  • Creating additional income streams 
  • Reducing financial stress in retirement
  •  
  • The result is a transformation in how retirement looks and feels—from restrictive to intentional and experience-driven.

The Role of Home Equity Conversion Mortgages (HECMs)

One of the primary tools enabling this shift is the Home Equity Conversion Mortgage (HECM), commonly known as a reverse mortgage.

When used strategically, a HECM allows homeowners to:

  • Access a portion of their equity as tax-free proceeds 
  • Eliminate monthly mortgage payments 
  • Establish a line of credit that grows over time 
  • Reduce reliance on volatile investment portfolios 
  • This creates an important advantage: retirees can preserve other assets while still maintaining—or even improving—their lifestyle.

Rethinking Retirement Strategy

The traditional retirement model assumes your home is off-limits unless you sell it.

The modern approach asks a better question:
What role should your largest asset actually play in funding your retirement?

For many, the answer is no longer “none.”

Final Thought

There’s a growing gap between those who rely only on traditional retirement income and those who are willing to rethink how all their assets—including their home—can work for them.

The difference isn’t just financial.

It’s lifestyle, flexibility, and peace of mind.

If you’re like many homeowners today, you may be sitting on significant untapped equity. The key is understanding how—and when—it makes sense to use it.

#284: Stabilizing Income Flow While Business Succession Plan is Executed

USING HOUSING WEALTH, ENABLE BUSINESS SUCCESSION PLAN SUCCESS 

Most of your adult life has been spent as owner-operator of a car repair and detailing shop. Now, preparing to retire, you’ve arranged to sell the business to your son. You’ve worked through various stages of planning, obtained a business valuation, and have made a number of important decisions. One of those decisions is to allow your son to make deferred periodic payments rather than paying a lump sum—meaning the sale will include a seller note.

While you’re confident that your son—and the shop manager who has chosen to stay on—will succeed in taking over and even growing the business, you have some understandable hesitation about your own cash flow during the first few years after the sale. Your wife will be retiring at the same time, and there are still several years to go before either of you reaches normal retirement age for social security.

As you’re learning, the financial side of transferring a business is closely tied to retirement planning. Selling a business in installments can provide steady income, and you want to help your son by giving him time to establish his own systems and policies. At the same time, it’s reasonable to be concerned about maintaining sufficient cash flow as both you and your spouse transition out of the workforce.

A HECM (Home Equity Conversion Mortgage) reverse mortgage set up as a line of credit could be the key to “regularizing” your income during this business transition period. Accessing your home’s equity as needed can provide peace of mind as you gradually reduce your involvement in the business—allowing your son, the existing staff, and any new hires to establish a solid routine and begin making the agreed-upon purchase payments.

Withdrawals from a HECM line of credit are tax-free,* and the unused portion of the available credit grows at the same rate as the interest charged on the borrowed amount. Once the transition period is complete and the scheduled business purchase payments are underway, you may choose—though you are not required—to make voluntary, penalty-free repayments to your reverse line of credit.

Allowing your son to purchase your business over several years, repaying you from profits rather than “out of pocket,” is not only a practical financial strategy—it’s also a powerful expression of your confidence in his ability to carry on the success of the business you worked so hard to build.

https://mutualreverse.com/david-garrison

*Please consult a tax advisor.

David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.org

Equal Housing Lender

#283: Reducing LTC Insurance Cost Now, Relying on Housing Wealth Later

OMIT LTC INSURANCE RIDERS NOW, RELYING ON REVERSE MORTGAGE LATER

FOR LONG TERM CARE INSURANCE, REVERSE MORTGAGE CAN REPLACE “RIDERS”

With both children having launched their careers, the two of you have begun to focus your attention on your own future financial security. Now in your early 50s, retirement is probably at least a decade away. Until now, your estate planning has been focused around guaranteeing that the children would be able to enter the workforce free of major debt. 

Moving forward, the emphasis has shifted to maintaining your own financial independence. Longterm care insurance has become a priority, and you’ve begun exploring both traditional LTC policies and hybrid options. The most significant cost factor appears to be the addition of inflation protection. You were initially concerned about continuing to pay those premiums once you retire, but you’ve realized that by then your mortgage should be fully paid off—freeing up cash flow that could be redirected toward funding longterm care coverage.

As you refocus from supporting your children to planning for your own future living needs and protection, you’re right to recognize that your home is an asset that should be considered alongside your retirement accounts. While it’s wise to establish longterm care protection now—when you’re more likely to qualify for coverage—you may choose longer “elimination periods” (meaning benefits begin months after a claim rather than immediately) and forgo inflation riders. These two choices can help keep premium costs within a more affordable range.

Then, when you reach age 62, you could establish a reverse mortgage on your home, using tax free* withdrawals from a home equity line of credit to help fund any longterm care expenses that exceed the policy’s coverage limits.

With this “nowandlater” approach, you put longterm care protection in place today while allowing the equity you’re building in your home to help address the higher costs of care later in life.

https://mutualreverse.com/david-garrison

*Please consult a tax advisor.

David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.org

Equal Housing Lender

#282: Refinancing a reverse mortgage to rebalance asset allocation

REVERSE MORTGAGE ENABLES REBALANCING — OF BOTH LIFESTYLE AND PORTFOLIO

After seven years of semi retirement, you resolved at the end of the last calendar year to begin full retirement this year, devoting your time to creative (amateur) pursuits. Having decided to continue living in your own home, you’ve completed a series of upgrades and adaptations to the house and grounds — and have been very pleased with the results. Even better, you were able to accomplish all of this without incurring any mortgage debt.

You’re now resolved to pay closer attention, going forward, to managing your financial assets. While you’ve been very pleased with the portfolio growth over the past couple of years, you’re concerned that—considering both your separate and jointly held investments—you’re overweighted in the stock market, with very little allocated to fixed income. Needless to say, the current political unrest around the world feels worrisome, and the standard advice about “rebalancing” offers little comfort when you consider the tax consequences of reducing your exposure to equities.

You’ve devoted serious thought to financing your retirement in both the near and more distant future, as well as to re-assessing your portfolio allocation decisions. One option you might consider is “rebalancing” your overall asset mix by using your housing wealth. By arranging a reverse mortgage on your home, you can effectively rebalance your assets—adding a debt component without triggering capital gains taxes from selling stockmarketbased investments.

Accessing your housing wealth through reverse mortgage financing may allow you to rebalance your asset mix without negative tax consequences—while adjusting confidently to your new, fully retired lifestyle.

https://mutualreverse.com/david-garrison

David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.org

Equal Housing Lender

#281: Refinancing a reverse mortgage to add a spouse

REMARRIAGE MAY BE REASON TO REFINANCE

It’s been nine years since, after arriving at two important decisions (you and your late wife retiring from full-time employment, deciding to age in place in your home), you took out a reverse mortgage. At the time, you used part of the loan proceeds for reconfiguring the living spaces to make them suitable for later years, but have not needed to make any withdrawals since that time. Widowed five years ago, you had been comforted by remaining in familiar surroundings, with no need to make monthly mortgage payments.* 

Remarried a year and a half ago, you would now like to add your wife to the reverse mortgage. While each of you wishes to remain in separate control of your assets for estate planning reasons, you want to guarantee her right to remain in the home should illness or death end your own occupancy. The two of you will be sharing the expenses of upkeep (insurance, repairs, etc), and also the costs of redecorating some of the rooms to suit her tastes.

While you know interest rates on mortgages are higher now than they were when you took out the original loan, there’s been significant appreciation in the value of the property itself; you’ve watched neighbors selling their homes for tens of thousands more than they might ever have expected. You’re hoping that a refinance will be a way to take advantage of the increase in value of your own home. 

You are correct in that, depending on a new appraisal of your home (sometimes the lower of two appraisals is used), a HECM-to-HECM refinance might help you take advantage of the appreciation of home values in your area. It sounds as if your new wife sill be listed as an “eligible non-borrowing spouse”, so that her right to remain in the home without needed to repay the loan is protected. From an estate planning point of view, it will be wise to discuss your plans with legal counsel.

As you embark on the future together, beyond the legalities, the reverse mortgage line of credit can provide a source of cash for emergencies or lifestyle costs. With no mortgage payments required, the two of you can combine your resources to design your new lifestyle together.

https://mutualreverse.com/david-garrison

*Borrower must occupy home as primary residence and remain current on property taxes, homeowner’s insurance, the costs of home maintenance, and any HOA fees.

David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.org

Equal Housing Lender