Category: Retirement

Why Your Financial Planner Should Be Talking To You About Reverse Mortgages

reverse mortgage loveland fort collins greeley longmont westminster coloradoWhen financial planners counsel retirees on how to best leverage their retirement portfolio, social security, and other assets, considering a reverse mortgage was long not part of that conversation – but this is beginning to change.

As the myths of the industry are laid to rest, many professionals are beginning to better understand how reverse mortgage can be used as a financial planning tool for seniors who are on a strict budget or who want to live their golden years to the fullest.  Reverse mortgages can often mean the difference between just living and living life to the fullest.

A few tips for financial planners:

  • Seek out and work with a reputable reverse mortgage specialist who has strong ties to the community, lends from an organization that is a member of the Better Business Bureau, and is associated with the National Reverse Mortgage Lenders Association.
  • Make sure you fully understand the information you may be offering your retiree client.  With the amount of misinformation within the industry, if you are not 100% sure of an answer, call your trusted reverse mortgage specialist to ensure the information you are providing is accurate.
  • Communicate with adult children who may have concerns and make sure they fully understand the process from A to Z.  Eliminating misinformation is key.
  • Remember, reverse mortgages are not one-size-fits-all.  Be creative and comprehensive when considering adding a reverse mortgage to a long term retirement plan.  

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, and Front Range areas of Colorado.  Click here to contact Jan and learn if reverse mortgage is right for you. 

5 Fast Facts About Reverse Mortgages in Colorado

reverse mortgage loveland greeley fort collins longmont boulder coloradoReverse mortgages have made a serious comeback in the past several years.  After regulation changes were enacted in 2015, the reverse mortgage loan once considered a desperate lifeline is now being used as a retirement tool for even the wealthy.  The loans are still only available to seniors 62 and older (including married couples) with the amount of funds available increasing depending on age and appraised value of the home, but now those funds are often being accessed in ways not available before – such as a line of credit or to purchase a home.  This really is not your mother’s reverse mortgage, it’s something much more versatile than it was years ago.

Here are some lesser known facts about today’s reverse mortgage:

1.)  I’ve said it before and I’ll say it again – the borrower will always remain the homeowner as long as basic responsibilities such as property taxes are paid, homeowners insurance is kept current, and utilities and HOA fees are paid.  One of reverse mortgage’s scariest myths has always been that a bank will own the home.  This couldn’t be further from the truth.  Not only will the borrower remain the homeowner, they will also retain the title.

2.) There are NO mortgage or loan payments.  That’s correct.  Regardless of how the borrower decides to utilize the reverse mortgage funds, they will not pay a loan or mortgage payment while they remain in the home.

3.) With a Reverse Mortgage for Purchase, borrowers can wrap both the home purchase and the reverse mortgage into the same transaction allowing them to buy their dream home – AND the reverse mortgage will substantially supplement purchasing power allowing a home to be purchased that may have once been out of their price range.  When using a Reverse Mortgage for Purchase, the borrower is required to provide some down payment and the reverse mortgage funds will make up the rest of the purchase price.

4.) Married couples can both be on the loan regardless of how the funds are utilized.  Another all too common myth is that in the case of a married couple, if one spouse passes away the other spouse will be evicted.  When working with a reputable reverse mortgage lender this should never happen.  As long as both spouses are 62 or over, they can both be on the loan allowing either borrower to stay in the home until the last spouses passes away or permanently leaves the home.

5.) Heirs are not “saddled” with the debt of a reverse mortgage.  After the borrower(s) pass away, there are several options as to what the heirs can do with the home.  And in today’s hot housing market, the home may gain equity that can be available to the heirs.  Most all reverse mortgages are FHA insured meaning the loan will never exceed the amount of the home sale – even if more is owed, and it also means it will only ever require the amount of the loan even if the home is worth much more when it comes due.

Jan Jordan is a Reverse Mortgage Specialist serving the Erie, Dacono, Fort Lupton, Windsor, Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado.  Contact Jan and learn if reverse mortgage is right for you.

 

Reverse Mortgage Can Help Coloradans Retire in Comfort

reverse mortgage loveland fort collins greeley longmont westminster coloradoFor many who remember the reverse mortgage scares of the yester-years, the terms ‘comfort’ and ‘reverse mortgage’ seem like an unlikely duo.  But they shouldn’t  be.

Since the FHA and HUD changed a few regulations stabilizing reverse mortgages in 2015, they have quickly been garnering new attention.  Whether looking to boost monthly income, protect retirement, or even purchase a new home, reverse mortgage is proving to be a versatile and creative tool.

Here are three ways a reverse mortgage can help make retirement more comfortable:

1.) Supplement retirement income.  With a whopping 36% of baby boomers planning to live on nothing but Social Security for retirement, utilizing a reverse mortgage to supplement retirement funds with non-taxable income from the equity of an individual’s home is a great option.  The funds can be accessed via monthly payments or a line of credit, and because the loan doesn’t come due until the borrower passes away or permanently leaves the home, they can live their retirement years both financially comfortable and in the comfort of their own home.

2.) Protect and enhance retirement portfolio.  For those who have a well prepared plan for their retirement, using a reverse mortgage line of credit to supplement their nest egg can offer great flexibility and even enhance wealth.  Some simply want to use the funds to delay Social Security until they can receive the largest amount.  Others may have investments they are looking to protect or allow to mature.  Retirement and financial planners are now discussing how a reverse mortgage can be used as part of a long term retirement plan.

3.) Purchase a retirement home.  It’s still a little known fact that a reverse mortgage can be used to purchase a new home – but it can, and it’s a great fit for so many retirees.  Whether looking to moving in to a senior community, move closer to family, or move to a dream home, using a Reverse Mortgage for Purchase should not be overlooked.  This amazing program makes the once impossible possible when it comes to home buying.

Reverse mortgage is an individualized, specialized loan for those 62 and older that allows seniors to tap into the equity of their home while living mortgage and loan payment free.  The funds can be accessed via a lump sum, line of credit, monthly installments, or even to purchase a home. If you are planning ahead, let your specialist guide you and help creatively suit your needs and desires.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado.  Contact Jan and learn if reverse mortgage is right for you.

Should You Use Home Equity In Retirement?

Reverse Mortgage Colorado Financial PlanningDid you know home equity can be used to reduce the overall risk of your retirement plan? Your house is a great asset that for many years has been overlooked in financial planning for seniors. This is making a sharp turn lately as retirement experts are beginning to understand how tapping into home equity via a reverse mortgage should never be underestimated.

Let’s take a look at where most seniors sit currently when it comes to retirement…

• Only 22 percent of workers are very confident they will have enough money in retirement.

• 45 percent of Americans have saved exactly nothing—zero.

• The expected lifespan of women is 20 years past the age of retirement, and two years longer than men.

• The average retiree can expect to spend $220,000 in out of pocket health care costs during retirement.

• Medicare pays for an average of 62% of a seniors health care costs, leaving 38% to come out of pocket.

• 36% of up and coming retirees will rely on Social Security as their sole income.

A reverse mortgage can help in many different ways – and the how the funds are spent is entirely up to the borrower. Whether it’s a monthly payout or a line of credit, when combined with other retirement planning tools, reverse mortgage can allow retirees financial security during the years they worked so hard to enjoy.

Reverse mortgages are available to senior homeowners 62 and over – even married couples. They will live mortgage payment free, always retain the title to the home, and because these loans are FHA insured non-recourse, no one – including heirs – will find themselves saddled with the debt after the owner passes. There are also various solutions for adult children or other family members who may want to keep the home in the family.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado, as well as the Cheyenne and Laramie communities of Wyoming. Contact Jan and learn if reverse mortgage is right for you.

A Glimpse Into What Retirees Want In Regards To Housing

Jan Jordan Blog : Reverse Mortgage Loveland Fort Collins Greeley Longmont ColoradoIf you find yourself yearning for a retirement of comfort in your own home in a community you love, you are definitely not alone.  Here are some pretty telling facts and statistics surrounding the desires of older adults in the U.S..

According to research by the American Association of Retired Persons (AARP):

  • Nearly 90 percent of seniors want to stay in their own homes as they age.
  • Even if they begin to need day-to-day assistance or ongoing health care during retirement, 82% would prefer to stay in their homes.
  • Most pre-retirees expect they will be able to live independently during retirement; only 14% expect they will need day-to-day assistance or ongoing health care at any point during their retirement.
  • Thinking about parents’ getting older is on the minds of 88% of adult children.
  •  75% of adult children and 69 % of parents think about the parents’ ability to live independently as they get older
  •  AARP identified housing features that seniors find are especially important in the later years: 

    – Safety features such as non-slip floor surfaces (80 percent)

    – Bathroom aides such as grab bars (79 percent)

    – A personal alert system that allows people to call for help in emergencies (79 percent)

    – Entrance without steps (77 percent)

    – Wider doorways (65 percent)

    – Lever-handled doorknobs (54 percent)

    – Higher electrical outlets (46 percent)

    – Lower electrical switches (38 percent)

From the National Assocation of Home Builders:

  • 75% of remodelers report an increase in inquiries related to aging in place.
  • The NAHB predicts that aging in place remodeling market to be $20-$25 billion.  That’s about 10 percent of the $214 billion home improvement industry.

According to the MetLife Mature Marketing Institute:

  • 91% of pre-retirees age 50 to 65 responded that they want to live in their own homes in retirement.  Of that group, 49% want to stay in their current homes, and 38% want to move to new homes

Whether it’s the desire to simply stay put through retirement, or to make modifications to the home, or even to purchase a new home, a reverse mortgage is a flexible tool to help finance any of these.  

Reverse mortgages are available to homeowners 62 and over, including married couples, with many protections in place to ensure borrowers are adequately educated before using this option, such as required third-party counseling.  Reverse mortgages are gaining in popularity among retirees from all walks of life.  A reverse mortgage for purchase option is available for those looking to purchase a new residence.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado, as well as the Cheyenne and Laramie communities of Wyoming.  Contact Jan and learn if reverse mortgage is right for you.

Will A Reverse Mortgage Affect Social Security, Medicare & Pension?

reverse mortgage loveland fort collins greeley longmont coloradoA very common concern among seniors and adult children when considering a reverse mortgage is how it will affect social security, medicare, and even certain pensions.  For many seniors, these benefits are a large part of their income. Fortunately, because the funds from a reverse mortgage are NOT considered taxable income, a borrower’s benefits will not be affected when taking out a reverse mortgage.

On the other hand, borrowers who have Medicaid, TANF, Food Stamps or SSI may see those benefits affected by this additional income.   Because these programs are government sponsored programs with strict approval guidelines based on all sources of income, even non-taxable income, there is a possibility the additional cash flow will need reported.  Other supplemental and assistance programs would need to be addressed on a case by case basis.  Working with a reputable reverse mortgage lender and required third party counseling will ensure all your questions are answered thoroughly and honestly.

Reverse mortgages are available to homeowners 62 and older.  The proceeds can be received as a lump sum, as monthly installments, or a reverse line of credit and can be used for any purpose the borrower sees fit.  This FHA insured loan allows the borrower(s) to live mortgage payment free.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Longmont, Greeley, and Front Range areas of Colorado as well as Cheyenne and Laramie, Wyoming. Click here to contact Jan and learn if reverse mortgage is right for you.  

Your Retirement Is Different Than Your Parents – Here’s Why

reverse mortgage loveland fort collins greeley longmont westminster coloradoDecades ago, when our parents were working and raising a family, they looked at retirement as the true golden years.  It would be a time when they stopped working and lived off the fruits of their savings and investments.  Retirement planners used a three-legged-stool strategy back then.  The make up of this stool was Social Security, employer-sponsored retirement plans, and personal savings.  But somewhere between their retirement and now this stool became unbalanced – and now today’s retirees are needing to compensate for it.  But how?

First, it’s important to remember that these three components of retirement are still an integral part of retirement success, which is why it should be considered how they can be best utilized as well as protected.  But it’s also important to consider what else has changed – things like life expectancy, a more active retirement, and a move toward non-traditional and even extravagant retirement goals.   Why not have it all?  And what are the options to achieve it?

Part-Time Work: It’s not uncommon for retirees to utilize a phased retirement strategy, where they can work and begin receiving benefits.  In addition to the obvious point of this – additional income – working can help to delay Social Security benefits, as well as keep older people engaged in the community.  

Reverse Mortgage: For those with substantial equity in their homes, a reverse mortgage can be an excellent way to balance out that stool analogy with a fourth leg, or simply get the boost retirees need to live that extravagant retirement life they’ve been dreaming of.  Funds are available via a line of credit, monthly installments, a lump sum, and even to purchase home (or a combination).  Because the income is not taxed, it can be used strategically with investments, or used to delay Social Security benefits.  Another common function is a stand-by strategy that taps the line of credit now, but only uses it during bear markets to protect investments.  These FHA backed reverse mortgages do not incur any mortgage or loan payments, although borrowers must keep up with homeowner’s insurance, property taxes, and other associated costs.  In addition to living mortgage payment free, they can actually eliminate any existing mortgage or HELOC payments, and the loan is not payable until the last borrower passes away or permanently leaves the home.  

Downsizing and HELOC’s:  When considering how to make ends meet during retirement, downsizing is often part of the conversation.  Selling the home and moving to smaller one, then using any additional equity as a retirement funding source.  For anyone considering this, I’d suggest looking at the details of a Reverse Mortgage for Purchase prior to making a final decision.  A Reverse Mortgage for Purchase option can allow buyers to get more house for their money, while still having cash to stash away for retirement. 

A Home Equity Line of Credit (HELOC) is another common solution.  When going this route versus a reverse mortgage, ensure the new monthly payment will not cause damage down the road if other needs arise, like medical care.  

Reverse mortgages certainly won’t be right for everyone, but for many they can be used creatively to aid in funding today’s retirement that is so different than what we are used to.  

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado.  Click here to contact Jan and learn if reverse mortgage is right for you.

5 Things You Need To Know About Reverse Mortgages

reverse mortgage loveland fort collins greeley longmont westminster coloradoReverse mortgages have made a serious comeback in the past couple years.  After regulation changes were enacted in 2015, the reverse mortgage loan once considered a desperate lifeline is now being used as a retirement tool for even the wealthy.  The loans are still only available to seniors 62 and older (including married couples) with the amount of funds available increasing depending on age and appraised value of the home, but now those funds are often being accessed in ways not available before – such as a line of credit or to purchase a home.  This really is not your mother’s reverse mortgage, it’s something much more versatile than it was years ago.

Here are some lesser known facts about today’s reverse mortgage:

1.)  I’ve said it before and I’ll say it again – the borrower will always remain the homeowner as long as basic responsibilities such as property taxes are paid, homeowners insurance is kept current, and utilities and HOA fees are paid.  One of reverse mortgage’s scariest myths has always been that a bank will own the home.  This couldn’t be further from the truth.  Not only will the borrower remain the homeowner, they will also retain the title.

2.) There are NO mortgage or loan payments.  That’s correct.  Regardless of how the borrower decides to utilize the reverse mortgage funds, they will not pay a loan or mortgage payment while they remain in the home.

3.) With a Reverse Mortgage for Purchase, borrowers can wrap both the home purchase and the reverse mortgage into the same transaction allowing them to buy their dream home – AND the reverse mortgage will substantially supplement purchasing power allowing a home to be purchased that may have once been out of their price range.  When using a Reverse Mortgage for Purchase, the borrower is required to provide some down payment and the reverse mortgage funds will make up the rest of the purchase price.

4.) Married couples can both be on the loan regardless of how the funds are utilized.  Another all too common myth is that in the case of a married couple, if one spouse passes away the other spouse will be evicted.  When working with a reputable reverse mortgage lender this should never happen.  As long as both spouses are 62 or over, they can both be on the loan allowing either borrower to stay in the home until the last spouses passes away or permanently leaves the home.

5.) Heirs are not “saddled” with the debt of a reverse mortgage.  After the borrower(s) pass away, there are several options as to what the heirs can do with the home.  And in today’s hot housing market, the home may gain equity that can be available to the heirs.  Most all reverse mortgages are FHA insured meaning the loan will never exceed the amount of the home sale – even if more is owed, and it also means it will only ever require the amount of the loan even if the home is worth much more when it comes due.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Lupton, Erie,  Lafayette, Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado. Click here to contact Jan and learn if reverse mortgage is right for you.

Retirement and Reverse Mortgage

reverse mortgage loveland fort collins greeley longmont westminster coloradoWith the varieties of opinions about reverse mortgages out in the marketplace a question comes up, that is, ‘would a reverse mortgage be a fall back, last resort, or would it be a positive option for a financial plan?’ While the answer lies in the hands of the borrower, or owner, there are worthy considerations to take into account.

Some might label those choosing a reverse mortgage as poor planners, those that did not take the time or effort to look long at their future needs and desires and work that into a plan. This mentality is changing fast though, as retirement experts are determining reverse mortgages can not only supplement the needs of some senior, they can offer them the retirement they always dreamed of.

There are many reasons to consider a reverse mortgage in a forward moving plan, making the choice before it might be the only option available (though this is not bad either.) First of all, many coming into retirement are ready to downsize or move. Maybe they raised their children in a two story house in Illinois, and now do not need five bedrooms, or to weather the cold when their children and families are in clement areas such as Georgia or South Carolina. A reverse mortgage makes this possible.

The amount a reverse mortgage can be reaches a defined limit, taking into account the equity of the present home and the age of the borrower(s.) This limit can be used in multiple ways, it can go towards that downsized home, be a line of credit, can cover monthly payments for the rest of their lives, or can even be a lump sum the borrower receives immediately.

There are also other typical reverse mortgage scenarios.

For instance, as well as one might plan, life offers us unexpected events. A reverse mortgage is a respectable option when a family is in distress, many foreclosures have been avoided with the solid help of a reverse mortgage. And sometimes, when a family is not even in distress, they wish to take advantage of all their hard work, which is there in the form of the home they own, and have liquid resources instead of just equity that cannot be utilized. The ways a reverse mortgage can be brought into the questions of a plan are as unique as the personal life situations existing.

For seniors 62 and older, a reverse mortgage can objectively be considered as an alternative revenue option. This takes away the stigma sometimes attached to it as a choice that was the only option left, a fall back when it is really a move forward.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Lupton, Erie,  Lafayette, Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado. Click here to contact Jan and learn if reverse mortgage is right for you.

 

How To Delay Social Security Benefits With A Reverse Mortgage

reverse mortgage loveland fort collins greeley longmont westminster coloradoWhen planning for retirement, there will no doubt be a discussion about when a retiree should start taking their Social Security benefits.

There are perks to delaying, for example Social Security benefits stand to increase as much as 7-8% per year if you don’t apply until age 70.  But many seniors need this income.  With the ability to apply for a reverse mortgage at the age of 62, and current low interest rates, retirees stand to actually make gains by using a reverse mortgage to supplement while delaying benefits.

When approved for a reverse mortgage, the borrower can choose from a variety of ways to access the funds.  It could be a monthly installment, a lump sum, or even a line of credit that in itself stands to grow over time.

This is a creative way to use the hard earned equity in your home to your benefit.  A well educated financial advisor would easily be able to help you decide if this is a good option.  Reverse mortgages are available to seniors 62 and over, including married couples, with an approved type of home.  The borrower will always retain the title to the home and reverse mortgages are insured by the FHA.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Lupton, Erie,  Lafayette, Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado. Click here to contact Jan and learn if reverse mortgage is right for you.