While stock market growth has worked in your favor these past two years since you retired, you are feeling far less secure going forward. You’ve been exploring possibilities for refinancing your home as a way to feel more secure about your own financial future.Widowed more than a decade ago, you are not planning to remarry, but you are very actively involved in cultural activities with friends, intending to make every effort to remain in your neighborhood. You’ve kept the house maintained and both indoor and outdoor décor updated, and hope to be able to live at home for decades to come.
A recent seminar you attended with a female friend dealt with ways to “utilize housing wealth” in retirement. Your friend liked the idea of having an equity line of credit, and, frankly having a source of extra cash sounds appealing for you as well, given the chance that the market value of your investments (as some pundits would have it) might take a “hit” in the not-so-distant future. At the same time, you understand that the equity in your home is a finite resource, and when you reach the limit of that equity line of credit, the money flow could come to an abrupt end.
Some clarification might be needed here. True, if you were to take a reverse mortgage structured as a line of credit, once the entire benefit is used up, no further draws will be permitted. At that point, you would have the choice of refinancing to take advantage of any appreciation in value that has taken place. The other important advantage is that, whatever portion of your credit line is not used will keep growing, increasing at the same rate as the interest being charged on the borrowed portion of the line.
A second approach is to take the reverse mortgage benefit in the form of a lifetime tenure payment, which continues for as long as you reside in your home, regardless of how long that is. Just as, in academic institutions, permanent employment status is granted to individuals after a probationary period, a tenure reverse mortgage payout is :”permanent” for as long as you occupy the home.
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.orgEqual Housing Lender