Use your reverse mortgage to pay off your current mortgage or to reduce expenses
Pay Off Mortgage
If you have an existing mortgage on your home, your reverse mortgage will eliminate your monthly mortgage payments. When you take a reverse mortgage, the funds are first applied to pay off any balance you currently owe on your home.
James and Patricia, a married couple (ages 70 and 62) were planning to retire. They felt they would be more comfortable if they did not have the monthly obligation for their mortgage payment and were just responsible for the customary costs associated with home ownership (real estate taxes, home owner’s insurance and home maintenance). After speaking with Nina and learning more about reverse mortgages, they decided it was the right product for them. Based on Patricia’s age (reverse mortgages are based on the age of the youngest borrower), they were able to use theirs to pay off the balance on their mortgage, eliminating their monthly mortgage payment, and chose to set up a line of credit with the remaining funds.
You decide how to use your reverse mortgage proceeds. For example, if you are carrying credit card balance, you could pay them down. This could eliminate that monthly credit card bill and avoid the interest charges associated with carrying credit card debt.
Susan is a 65-year-old, single woman who owns her home, free and clear. She has expenses for her real estate taxes, homeowner’s insurance, utilities, cable, phone and internet services, car insurance, health care related costs, credit card payments and the costs associated with day to day living. In discussions with Nina, Susan became educated about how reverse mortgages work. Susan decided to get a reverse mortgage and use some of the funds to pay off her credit card balance and the monthly installments associated with her health insurance supplements. This freed up $540. every month in her budget.
Nina Penny - Certified Reverse Mortgage Professional © 2023