Ensuring a Comfortable Retirement at Home

Brookline MA

11 February, 2021

1:22 PM

Description

Ensuring a Comfortable Retirement at Home: Tapping Into Your Hard-Earned Equity If you’re dreaming of a comfortable retirement soon, or are already retired, will COVID-19 change your plans to stay in your family home? It’s a question that many Baby Boomers and seniors are now confronting, given the economy’s ups and downs and continued layoffs. Here are questions keeping these individuals up at night: Will I have enough cash to cover the mortgage during the pandemic and afterwards?If I am suddenly widowed, will I still have the financial resources I need to remain in the house?How can I avoid dipping into Social Security early, or selling investment properties, without additional income?If I need in-home care, will there be any money left over for general expenses? As a result of these concerns, I’m hearing from many people who worry that they will be forced to sell their homes. They’re often unfamiliar with a potential solution to the challenges they’re confronting—a reverse mortgage. I thought a very brief “primer” on what reverses are, and some of their lesser known applications, might be useful. Reverse mortgage loans enable homeowners who are 62 or older to convert some of their equity into tax-free money*. For example, HECM (Home Equity Conversion Mortgage) reverses, which are insured by the US government, provide loans for 45-75 percent of a home’s value. These loans are essentially a new source of cash. Homeowners don’t have to repay them as long as they live in their house and keep up with the insurance, taxes and essential maintenance. They are loans, though, and the balance will someday be deducted from their home’s sale. Reverses are not just a potential tool for people who need extra help to age in place. Some borrowers simply want to enjoy more of their accumulated wealth while they are still healthy and active. Their home is their largest investment, and they don’t want to sell it in order to take vacations or order takeout regularly, “guilt free”. Many are interested in helping their adult children financially now, especially if the pandemic has set them back. Others want to donate to a beloved charity and enjoy seeing the impact of their gift. Reverses give them the ability to accomplish these or other goals. Not everyone qualifies for a reverse, and lenders talk in detail with borrowers to make sure the loans will meet their needs. But for some Boomers and seniors, a reverse mortgage may provide a financial cushion that they didn’t know they had. Brookline resident Bonny Gilbert, Esq., NMLS #300106 leads the Bonny Gilbert Reverse Team with Fairway Independent Mortgage Corporation, Boston. She is licensed in Massachusetts, Connecticut, Maine, New Hampshire, New York, New Jersey, and Virginia. Contact her at [email protected] or 857-300-6775. 380 West Broadway Unit 101, South Boston, MA 02127. Click here for legal disclosures * This advertisement does not constitute tax advice. Please consult a tax advisor regarding your specific situation.