California Reverse Mortgage Success Story
Why are so many retired homeowners turning to reverse equity mortgages to supplement their income? There are several reasons that reverse mortgage loans have become popular. America is seeing the emergence of a growing senior population that is confronting anxieties about the status of pension plans and retirement funds.
In America, reverse mortgages are a special type of loan used to “unlock” the equity in older homeowners’ (ages 62+) homes, allowing seniors to cash in on the equity in their homes without conceding any ownership of the property. The income generated by reverse mortgage loans is tax-free.
Payments are deferred as long as the property remains the borrower’s primary residence. There is no obligation to repay the loan until the owner dies, the home is sold, or the owner otherwise vacates the property (for example, to move into an assisted-living facility).
This article intends to address perceived reverse mortgage pitfalls by collecting real life success stories from across the nation. The stories are real and inspiring, and exhibit how reverse mortgages for seniors have improved the quality of life for many senior citizens around the United States.
Sacramento CA
Mr. & Mrs. Whitfield can hardly believe the home they paid $23,000 for in 1962 is now worth $550,000. Still, the couple is far from rich. The Whitfield’s are just two of millions of Americans who are “house-rich and cash poor.” Since retirement, the Whitfield’s have been unable to keep up with the general maintenance on their home, which limits the property from appreciating further.
Prior to learning about reverse mortgage programs, the Whitfield’s struggled daily to pay their bills on time, and spent their money only on necessities. Their tight circumstances prompted them to apply for a Home Equity Conversion Mortgage (HECM reverse mortgage) recently. This common type of bank reverse mortgage has alleviated some of the couple’s struggles by ensuring the Whitfield’s have a monthly income for the rest of their lives.
The Whitfield’s view their home as an investment that has matured. Although they chose to borrow only a very small percentage of their home value, they now have money for date-nights, and new siding for their home – in short, the money has given the couple a new lease on life. The Whitfield’s also like the idea that they could sell the home at any time, pay off the reverse mortgage, and have plenty of equity left for future needs.
Mr. Whitfield summed up his satisfaction with the family’s decision to learn more about the reverse mortgage industry, saying, “Our golden-years suddenly really feel golden.”