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Reverse Mortgages as a Financial Planning Tool

A Reverse Mortgage enables the homeowner to utilize the equity in their home, without having to sell their home or give up title.

The loan proceeds are:

  • Tax-free
  • Require no re-payment
  • Unrestricted and may be used for any purpose

For these reasons a Reverse Mortgage is being looked upon as a LEVERAGE vehicle. A Reverse Mortgage is better explained as a facility that allows a portion of the equity in a home to be converted into CASH.
CPA/CFP(s):Your clients need a Reverse Mortgage more than you think!

Reverse Mortgages are designed to allow seniors to stay in their homes, pay off existing debt, and defer payment until the end of the loan. This program allows seniors to access their available assets to pay for immediate needs such as food and medicine while not depleting long-term savings. Because Reverse Mortgages are non-recourse, only the home may be pledged to pay off the loan, thus protecting all other assets. Any assets that are removed from the Equity Line of Credit prior to the maturity event would also become a protected tax-free asset.

When could your clients use a Reverse Mortgage?

When they need to get a Life Insurance Policy for various reasons:

  • To pay for accrued Property Taxes.
  • If they are in arrears with the IRS and have no other liquidity?
  • When they cannot afford rising Homeowners Insurance premiums?
  • Fixed Income Clients that cannot make ends meet?
Reducing Debt with a Reverse Mortgage

Long Term Care:Can’t afford it? A Reverse Mortgage can help!
  • 75% of all couples turning 65 years old will need Long-Term Care in their lifetime.
  • Only 12% of the population have Long Term Care

When a need for long-term care arises, unprepared seniors are forced to use:

  • Meager Savings or,
  • Diminish their monthly income in order to fund this unexpected expense.

A Reverse Mortgage may be used as source to fund a Long-Term Care Insurance policy, while,

  • Allowing the senior to remain in the home,
  • Retain self-sufficiency and independence,
  • Leave existing savings or income intact,
  • Protect existing assets, and
  • Relieve any potential burden on family members.

At Reverse Ultra, we have worked with case workers and care takers to help Seniors ‘find the money they need to provide for the care they need’.