Prime Time for Reverse Mortgages

Reverse-Mortgage If there were ever a “best time in history” to get a reverse mortgage, now may be it.

  • Home values are at record highs (maximizing the potential proceeds of a reverse mortgage)
  • Reverse mortgage rates are at record lows (as low as 3.25%)
  • Reverse mortgage rules are also more flexible than in the past (For example: Funds can be received over time instead of in one lump sum, and interest payments can now be made to reduce interest costs.)

The potential is high that reverse mortgages will not be as attractive this time next year.

  • Interest rates are expected to rise (which would make it more expensive to take out a reverse mortgage).
  • Home prices could fall (thus reducing the potential proceeds from a reverse mortgage)

So, if you’re over 60, in need of cash, and have sufficient home equity, now is as good a time as ever to consider a reverse mortgage.

Keep in mind one thing, however.  Reverse mortgages are not always the best solution. There may be less expensive options to create cash flow, depending on one’s circumstances.  Proper counsel from a qualified mortgage planner is therefore essential.

If you’d like to learn more about reverse mortgages here is a brief overview:  Reverse Mortgages Explained

Or, you can call or email any CHIP-approved mortgage planner for detailed information.

  1. Reverse mortgages are the worst product a senior could put their equity into.Borrow the money out of their equity and see it dwindle down as they try to outlive the money.Then when they sell the property they owe all that money back plus interest to the reverse mortgage.There is a much better way for seniors to have some retirement money.Please contact me for more information.
    [Edited. Thank you for the post. I’m sorry but we ask that folks do not post contact info in the forums. Otherwise the site would be overrun with promotional messages. You are welcome to link to your name, however. Thank you for your understanding. – Elizabeth, CMT]

  2. I must respectfully disagree with Trent. Home equity is only viable source of funds for many seniors who require additional income. Reverse mortgages are basically a loan secured by equity, but better. Seniors do not need to “qualify,” make payments, or ever worry about losing your house.
    The only negative is the interest rate. Fortunately, CHIP has become much more agressive on rates and annual home value gains offset much of the interest over time. I also find that a lot of people forget they can counter the effects of interest by investing reverse mortgage proceeds into income generating investments.

  3. Mary Anne,
    What income generating investments are you talking about? Is the investments guaranteed? If this is income this will add to the seniors taxes. Most seniors I know don’t like to pay more taxes. You are assuming home values are always going up, higher than the interest rates. The returns on real estate may not be able to repeat what it has done in the last ten years, because of dropping interest rates.
    When you combine property taxes, maintenance, etc. I think you will find higher costs to the senior than what CHIP interst rates will charge.

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