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#187: Using a reverse mortgage to start online sales training center


At age 63 and recently retired from a long-time, top-level corporate sales training position, you’re looking forward to having greater control over your own time. An idle existence, on the other hand, would never be to your liking, and the plan is to develop an online sales training business offering a series of advanced, top-of-the-line courses in sales and marketing, focusing on four specific industries. While the “students” might be located anywhere in the world, the plan is to hire four locally-based instructor/trainers, who will earn teaching fees in addition to earning “commissions” for recruiting enrollees. 

The relatively modest capital investment needed will go towards converting two of the rooms in your home to “studios” for video recording, involving both some structural redesign and purchase of equipment. You’ve kept the home itself in excellent repair, and it became mortgage-free eight years ago. Meanwhile, as you work to get the new venture “off the ground” your own ongoing living expenses are covered by regular withdrawals from your IRA Rollover and personal investment accounts. You’ve maintained an excellent credit rating, keeping debt very low, and qualifying for a home equity line of credit should not be a problem.  

While leveraging the equity you’ve built up in your home over the years as the capital “boost you need to get your training business off the ground, you might consider doing that with a reverse mortgage, rather than using traditional mortgage financing. With a reverse mortgage line of credit, you’ll need to pay the property taxes and insurance, but there will be no ongoing required payments. What’s more, the “draws” you take out of the equity line of credit will be tax-free so long as you continue to occupy the home. Once the business begins to generate net profits, you may choose to partially or fully repay the loan. In the meanwhile, the untapped portion of your equity will be credited with the growth at same rate as the interest being charged on the outstanding loan balance. 

Putting your equity “to work” can make turning your home office into a sales training “command hub” a real possibility.

Readers, if you’d like to see what you might qualify for with a reverse mortgage in Indiana, or to download your Reverse Mortgage Guide Click Here(and scroll down).

Please consult a tax advisor.