2169 East Rutland Lane, Martinsville, IN 46151
Corporate NMLS #1025894

April 26th, 2022

After your father’s death three years ago, you moved your mother into your own home, remodeling a bedroom/bath/sitting room for her on the lower level of your house (using the proceeds from the sale of her condo). Over the course of these three years, you’ve hired various part-time senior care assistants, which worked out well for awhile; in fact your mother insisted on covering those costs herself. 

Recently however, to ensure her safety, you were forced to move Mom into a nearby assisted living facility where the availability of care is more consistent. Thankfully, your mother owns a long-term care insurance plan which should cover (after the six month “waiting period”), around half the monthly fee for the next few years. Still, you’re concerned about depleting your own retirement assets.

While you might consider renting out the space in your home that you created to house Mom, you might also consider using the equity in your home as a source of backup funding. As needed, you would use withdrawals from the line of credit to help pay for Mom’s assisted living costs. Of course, once Mom’s Long-Term Care benefits kick in, more funds might not be needed for awhile, allowing the unused portion of your line of credit to accrue interest. Until and unless you move out of the home, there will be no obligation to make payments on the loan.

A reverse mortgage is one way to “assist” with the costs of assisted living for Mom!

https://mutualreverse.com/david-garrison/

2169 East Rutland Lane, Martinsville, IN 46151
Corporate NMLS #1025894

April 19, 2022

Following a few months spent “window shopping” in this frenzied real estate market, you’ve made the decision to retire in place. Following a combination of several do-it-yourself and contracted renovations, the “new interior” of your home feels too comfy to leave. However, you want to create a master bedroom downstairs. Also, while some shrubbery and flower beds were added for “curb appeal” preparatory to a sale, now that you’re going to stay, you’ve decided to do a major “Property Brothers”-style outdoor reno. You envision new walkways, stonework, and a fountain. 

A small portion of the funding can come from the money you saved by not moving, but you’ll still need around $40,000. Thus far, you’ve steered clear of borrowing, but don’t wish to deplete liquid assets any further, and would prefer not to tap into tax-deferred retirement accounts. 

Now that you’ve made the decision to “retire in place”, using the equity in your home to fund the internal and external renovations might make a lot of sense. A reverse mortgage set up as a line of credit will allow flexibility, so that you’re using the money as needed through the different stages of interior and external home improvements. 

A reverse mortgage can help create beautiful surroundings from the outside in!

https://mutualreverse.com/david-garrison/

2169 East Rutland Lane, Martinsville, IN 46151
Corporate NMLS #1025894

April 12th, 2022

When it comes to sharing cash or assets with your children, the two of you have always agreed – and made clear to your children – that once you got them through their schooling, they would be expected to manage their finances on their own. Upon the second of your deaths, of course, you’d arranged for your three children to inherit (equally) whatever wealth remains. You have grandchildren, but the plan was for each set of parents to provide for their own offspring in their own way. Unlike the case with many of your friends and their children, you were able to discuss all of this openly with your kids, making your intentions clear. 

You are far from wealthy, but with your home paid off and in good physical condition, you’ve been able to manage well on retirement plan income and social security, hoping to remain in your home for the rest of both your lives. Everything appeared to be going according to plan – until, suddenly, it wasn’t.

Your oldest daughter’s husband was killed in a traffic accident at the end of last year, and, after quitting her own job, your daughter is making valiant attempt to save the small business they’d owned together. Meanwhile, there are junior high-school aged children at home, one of whom is in need of therapy. It is plain that this daughter needs financial help now.

Rather than tapping your own retirement assets, consider using your housing wealth to provide the needed help for your daughter and grandchildren. Since your plan is to “age in place”, a reverse mortgage line of credit will enable you to “draw down” tax-free loan proceeds which you can use to provide the financial assistance your daughter needs today.  There will be time later to discuss if and how you’d want to adjust your estate plan to accommodate this “early legacy” to one child.

When “later” arrives earlier than planned, a reverse mortgage can provide a “legacy” needed now! 

https://mutualreverse.com/david-garrison

2169 East Rutland Lane, Martinsville, IN 46151
Corporate NMLS #1025894

April 5th, 2022

With a twelve year age difference between you and your wife, you’ve given some serious thought to living options. First choice, you both agree, is spending the rest of your lives in your Indiana home. As you enter your eighties, though, you worry whether you’ll remain healthy enough to avoid being forced to move into an assisted living facility or nursing home.  Even should such a move become inevitable, you want your wife to be able to spend the rest of her years in your home.

Your documents have been kept up to date (healthcare power of attorney forms, long term care policies, etc.), so the discussion now comes down to financial choices. Your combined retirement pension benefits, along with some investment income, have so far proven sufficient to cover your costs of living. Your wife is a very capable money manager, but the costs of facility care might be onerous when added to the upkeep of the home. You both would like having a contingency plan in place.

You might consider freeing up the equity you’ve built up in your primary residence by applying for a reverse mortgage line of credit. You apparently have no immediate need to make withdrawals, but you would have the reassurance of being able to easily tap that guaranteed, growing line of credit should you need to move – either temporarily or permanently – into a care facility. Meanwhile, your wife would be guaranteed the right to remain in the home for the rest of her life.

A reverse mortgage would be a way to use home equity to hold down the fort. 

https://mutualreverse.com/david-garrison/

2169 East Rutland Lane, Martinsville, IN 46151
Corporate NMLS #1025894

The two of you have always made annual charitable gifts to humanitarian causes, and in fact provided gifts for two of those organizations in your recently updated estate planning documents. This year, you’ve made the decision as a couple to make a much larger donation to help Ukrainian refugees.  Those poor people need help now, you realize, not someday, if they are to survive the horrors of losing their homes and jobs during the brutal invasion of their country….

Your own retirement pension benefits, along with some investment income, have so far proven sufficient to cover your income needs, even given the recent inflationary spike. Still, you’re wrestling with what size commitment to make, while still preserving assets in case future medical or other unexpected costs arise.

A Home Equity Conversion Mortgage (HECM) line of credit might provide a solution, by  freeing up the equity you’ve built up in your primary residence. You can easily tap that guaranteed, growing line of credit to make a meaningful donation to charity without putting additional pressure on any of your investment or savings resources. Meanwhile, the unused portion of your reverse mortgage revolving line of credit can continue to grow.

You can free up charitable dollars to help fight poverty overseas, while preserving your own investment dollars for fighting inflationary pressures at home. 

https://mutualreverse.com/david-garrison/

2169 East Rutland Lane, Martinsville, IN 46151
Corporate NMLS #1025894

Given the state of the economy, you can’t help thinking you should have waited before retiring. You’d done quite a bit of careful planning in terms of arranging systematic withdrawals out of your investment accounts, but with the recent sharp increase in everyday costs, you’re afraid the system will lead to running out of money. While you’re pleased with your (thankfully) paid-off and newly remodeled home, the utility costs have escalated along with everything else. 

Your investments have suffered only minor – and only recent) declines, but you’re concerned that growth in value will be, at best, modest over the next several years. Withdrawing more than the originally planned monthly amount seems risky; even the originally planned amount would put stress on the portfolio value.  Meanwhile, after decades of maintaining absolutely zero credit card debt, you’ve been forced to allow some balances to carry over from previous months’ spending posing yet another reason for concern about the predicted near-term rise in interest rates. 

A reverse mortgage on your home can help support your monthly income needs, either by supplementing your portfolio withdrawals or, at least in the near-term, replacing them entirely. Unlike the credit card debt you mention, you will pay no interest on un-borrowed funds in your reverse mortgage line of credit, and costs will be significantly lower than those on credit card borrowing. What’s more, unlike a regular line of credit at a bank, with a reverse mortgage line of credit, as long as you have a remaining balance, your line of credit can never be frozen or closed. In fact, the unused portion of your credit line grows, using the same rate at which the loan accrues interest! 

Thankfully, as you said, you’ve been able to accumulate housing wealth.  Now might be the time to let that housing wealth do the job of supplementing, or even  “standing in” for your portfolio draws. 

https://mutualreverse.com/david-garrison/

2169 East Rutland Lane, Martinsville, IN 46151
Corporate NMLS #1025894

You’ve been toying with the idea for years, but all that ice and snow last month in Indiana “clinched the deal” for you. Widowed and in your mid-seventies, you want to remain a resident of Indiana, but own a small place in the sun where you can spend the winter months. You have cousins in New Mexico, and will probably look there first.

You have the resources to make a substantial down payment on a second house or condo, but in order to totally fund a purchase, you’d need to use retirement plan assets, which you are reluctant to do.

You might consider a HECM refinance, which is a type of reverse mortgage loan where you use the equity in this home to purchase a second residence. Your Indiana house would remain your primary place to live, but you’d be tapping the equity you’ve built here to fund that “place in the sun.” Depending on the numbers, you might even be able to totally finance the purchase of the New Mexico home.

Of course, you’ll want to be sure your income is enough to cover property taxes, insurance, and other costs of home ownership in both places.  Assuming that’s the case, a reverse mortgage can be an excellent way to “feather a nest” in the sun.

https://mutualreverse.com/david-garrison

2169 East Rutland Lane, Martinsville, IN 46151
Corporate NMLS #1025894

While your original plan was to move to a smaller home with fewer outdoor grounds to maintain, no stairs, and senior-friendly baths, you’ve simply given up. The bidding wars and the incredible “need for speed” in the buying process for today’s real estate have simply scared you away.  Instead, you’re now resolved to remodel the kitchen and bath in your present home. In later years, if needed, you’ll install a stair lift. 

Financially, you feel prepared for the initial costs of the renovations (in the process of all that home shopping, you cashed in several investment accounts and have been stockpiling cash reserves). Now that you won’t be selling the home, however, you will need to borrow money to finance the later stages of the work.

What you’ve been discovering, much to your dismay, is that all those supply chain issues and labor shortages you’ve been hearing about on the news are very real. You’re being told by contractors that you must be prepared for long delays and rising costs (even quotes might not be “locked in”, you’ve been warned). 

Now that you’ve made the decision to “age in your own place”, a reverse mortgage line of credit might be a good way to finance those irregularly-timed renovation expenses, using the equity you’ve built up in your home. Set up as a line of credit, your reverse mortgage will allow you to draw from the equity as needed to pay for each stage of the renovation.  Meanwhile, the unused portion will be growing at the same rate the mortgage balance is increasing.

Your reverse mortgage home equity line of credit equity will be there to help you ride out the ups and downs of supply chain and labor shortages, while you redesign your surroundings for “staying put.”

https://mutualreverse.com/david-garrison

2169 East Rutland Lane, Martinsville, IN 46151
Corporate NMLS #1025894

March 1st, 2022

When the two of you retired just seven years ago, you took comfort in knowing you were each covered by a Long-Term Care insurance policy with lifetime benefits. Since then, there have been two premium increases, which you have been able to handle. Luckily, the growth in your investments has so far allowed you to keep up with even the steep rise in grocery, heating and gasoline costs.  

With all the talk about aging in place, you are undecided on the subject.  You enjoy your home (now fully paid for), and certainly hope to spend the rest of your lives there. However, should healthcare needs dictate, either of you could be forced to use a care facility, since neither of your LTC policies includes home care. 

Of immediate concern is a recent notice you’ve received from the insurance company describing a third premium increase. The letter offers you several alternatives: maintain your current benefit levels with a 20% increase in premium, keep paying your current premium but accept a longer “waiting period”, or reduce premiums while settling for three to five years of benefit payouts as opposed to lifetime benefits.

A reverse mortgage on your home might provide an answer, even if you don’t need to tap the equity in your home right away. Your mortgage can be set up as a growing line of credit, becoming your safety net against any future rises in LTC insurance premium costs. 

You may be “undecided” on aging in place, but a reverse mortgage will allow you enjoy your home together and put that decision on indefinite hold.

https://mutualreverse.com/david-garrison