Why Is Now The Time To Get A Reverse Mortgage
Jim and Pam are 65 and 63 years old, respectively. They have both retired and have been considering options for supplementing their income to take care of some outstanding bills that are weighing on their mind and to increase the flexibility of their finances. The couple has built up significant equity in their home over the years, so Pam brought up the idea of a reverse mortgage, and they have been going back and forth about not only whether a reverse mortgage is right for them, but also if NOW is the best time to get one.
Does any of their discussion sound familiar? The truth is that Jim and Pam are fictional, but it is also true that many real Americans (maybe even yourself) are in a very similar situation. So how do you decide?
If you’ve done you research, you may have heard about recent changes in the government-insured Home Equity Conversion Mortgage (HECM) program, but despite these changes, a reverse mortgage might still be the perfect option for you, and there are several reasons now might be the perfect time to obtain one. Let’s look at a few.
You need money, now. For most of us, worrying about money is something we will do our entire adult life. Just when you feel like your feet are back on solid ground, another unexpected expense pops up to rattle your world. It may be medical bills, home repairs, or family members who need assistance, and the list goes on. Whatever the reasons, if you are struggling to make ends meet or worried about being able to pay your mortgage and keep a roof over your head, now might be the perfect time to obtain a reverse mortgage and the peace of mind you’re craving.
Your home value has skyrocketed. My husband and I have been considered a new home purchase, so I’ve been keeping my eye on the housing market here in Columbia, Missouri. Let me tell you: in our area, housing prices are up! We’ve seen several homes sell above the listing price, and the increase in home values is a trend that can be seen in many areas across the country. The higher your home value, the larger the amount you qualify for in a reverse mortgage. So, if you’re in a similar area, where home values have risen, now might be a great time to pursue a reverse mortgage.
You are looking to downsize. If you’re still living in that larger home that’s feeling a little empty and getting cumbersome to take care of, you may want to take advantage of those high home values in a different way. Did you know you can purchase a new home with a reverse mortgage? That’s right! You can use the proceeds from the sale of your current home to obtain a reverse mortgage on a new home, and never have to worry about a mortgage payment, as long as you keep up the new home and pay the taxes and insurance. Not many people are aware of this option.
The fact is, no matter what is going on with interest rates or the markets, the perfect time to get a reverse mortgage is very specific to your personal situation. These are just a few reasons to proceed with a reverse mortgage, but there may also be reasons getting one right now is not the best option for you. If you’re struggling with the decision, sometimes the best thing to do is to talk it over with a knowledgeable third party. Any reputable loan originator would be happy to discuss your situation, personally, and refer you for housing counseling.