Someone You Know is Thinking About a Reverse Mortgage

Hi everyone. Hey, thanks so much for taking the time to watch this video today. I want to talk about a little bit of a mysterious loan product or at least one there doesn't seem to be a lot of common knowledge on, and that is a reverse mortgage. And I'm gonna specifically talk about the most common reverse mortgage, which is an FHA -So government insured reverse mortgage. And if you don't know about reverse mortgage or what it, the first thing I'll tell you is that it's the best fit for somebody that chooses to look at their equity as an asset. So they're saying, Hey, my retirement years, this is an asset that I will use to a little more "gold in the golden years", if you will.

And they want to make their retirement better, the particulars, or at least kind of some overview on this loan is that unlike a forward mortgage where you're making a mortgage payment every month, it's required mandatory, that that happens. And you're paying the loan balance down. 

A reverse mortgage is just the opposite. You are not required, you can, but you are not required to make a mortgage payment. And that mortgage payment that you don't make is simply added to your loan balance. So your loan balance over time goes up. Now the beauty of this is that yeah, you have a mortgage balance that goes up, of course, but you've also had a plan to use the equity for your retirement years, that just makes sense.

Just like you draw down on a 401k or another, uh, asset that you have invested. A lot of folks will draw down on that as time goes on. And the beauty of this reverse mortgage is that it is never required to be paid back by the borrowers in their life.

As long as they meet a couple of conditions, number one, that it stays their primary residence. Number two, that they pay their property taxes and insurance. And number three, that they simply maintain the home. You know, they don't let it go into a condemned status. That's it. So a reverse mortgage borrower can live in that home and stay there for their lifetime - so they can essentially age in place.

And once the youngest spouse passes away, then that reverse mortgage is due within essentially within a 12-month period of time. The beauty of this loan product is that even if the loan amount is higher than what the value of the home is, this FHA insurance covers it so that the errors are never responsible for any kind of deficit.

Basically, an appraisal's done on the property. Bank's paid off. If there's a deficit, FHA insurance, government insurance comes in and pays the difference. So it's a really intriguing loan product.  I've seen a lot of crazy things about reverse mortgages and just misconceptions, just misunderstandings.

It's not a scam. It's absolutely a viable tool. It's not for everybody. It has to be the right circumstances, and those things have to be weighed. So this is a much bigger conversation than just this, this video. But if you have questions about reversible mortgage, whether it's for you or maybe it's for a parent,  feel free to give me a call, or shoot me an email.

I'd love to talk to you about this. I've done these loans for family members. It's not, again, not for everybody, but there are definitely people that this is a very, very beautiful solution to some of the financial challenges that they may experience in their golden years. So, feel free to give me a call if you have questions or shoot me an email.

Thanks again for watching, this video. Hope you have a great day, and I look forward to speaking with you soon.

* Specific loan program availability and requirements may vary. Please get in touch with the mortgage advisor for more information.