Many financial experts have started viewing reverse mortgages positively and strategically: A paid-off house is an asset, or a nearly paid off asset, as similar to a retirement portfolio. Some financial planners see as taking money out of the house as no different from spending down an IRA or investment portfolio.
A few scenarios in which a reverse mortgage can assist a surviving spouse financially: including use of a reverse mortgage’s proceeds to delay the taking of Social Security benefits until age 70; allowing a retirement investment portfolio to grow in a “rising market” instead of using it to pay for living expenses; paying down high-cost services like long-term care, or high interest rate credit cards; or the use of a reverse mortgage’s proceeds to fund home renovations that can more easily allow for aging in place.
When a spouse passes and the remaining spouse may be faced with a reduction in Social Security and/or pension income, a reverse mortgage credit line allows a widow to tap into the home’s equity. A reverse mortgage credit line loan is a life time loan and cannot be reduced or closed at will by the lender, unlike regular home equity lines of credit that also require a monthly payment and can be cut off by the lender at will, a reverse mortgage loan has no monthly payment and, as long as property taxes, insurance, and home owner’s associate dues are paid current, the reverse mortgage lender may not close or reduce the credit line.
Excerpt from Reverse Mortgage Daily and The Street
===Shawna McDonald, Reverse Mortgage Loan Officer, 12 year specialization solely in reverse mortgage loans, successfully having completed hundreds of them. Representing 10 of the largest reverse mortgage lenders in the nation you’ll receive: great rates & local, personalized service from loan start to finish. Visit my website www.SierraFoothillsReverse.com Available by confirmed appointment in my downtown Grass Valley office or during COVID, by phone, for a no obligation consultation. (530) 497-3010 NMLS #271335 | CalDRE #00585530 Borba Investments Inc. Company NMLS 76801 |Company CalDRE # 014461