Is It The Right Time To Get A Reverse Mortgage?

Calculate Your Eligibility

Have you been wondering if now is the right time to get a reverse mortgage?  You’re not alone.  Demand for reverse mortgages has been on the rise since March 20201 which coincidences with the global pandemic and the economic hardships that many are currently facing.

How A Reverse Mortgage Can Help You

A reverse mortgage is a Federal Housing Administration (FHA) insured loanwhich allows homeowners who are at least 62 years old to access a portion of their home’s equity without having to make monthly mortgage payments.2 If you still have a mortgage on your home, it must be paid off using the proceeds from your reverse mortgage loan. If you don’t have a current mortgage, it increases the amount of money you may be eligible to receive.

Interest Rates Are Low

With the Federal Reserve rate cuts in March 2020 to help with inflation and unemployment2, it also has had a direct impact on interest rates. As with most financing, the lower the interest rate, the more borrowing capacity you will have. A lower interest rate will result in a higher calculation of the principal limit at the beginning of the loan. The borrower can access more home equity upfront and over the life of the loan.  Plus, a lower interest rate will decrease the amount of money added to the balance of the loan.

Current Housing Marketplace

With limited inventory on the market, home prices are on the rise.3 When the home-buying demand exceeds supply it gives the sellers the upper hand. If there aren’t many homes for sale in your area, it may work in your favor with your home appraising for a higher amount. However, if the reverse happens and supply exceeds the demand, your property value may not be as much.

Is It The Right Time To Get A Reverse Mortgage?

Line Of Credit

The proceeds from a reverse mortgage can be disbursed several ways.  One option is a reverse mortgage line of credit.4 Unlike the traditional reverse mortgage in which the proceeds are withdrawn in a lump sum5 immediately after closing, the proceeds from a line of credit may appreciate over time. You can withdraw from the line of credit at any time.  The unused portion of your credit line grows over time, independent of your home’s value.  This means that the less you take upfront, the more you’ll be able to borrow later. For someone who doesn’t need the money right away, the reverse mortgage line of credit growth option can be a long-term strategy that can be used as part of a financial retirement plan.

Financial Preparedness

Seniors don’t want to be left worrying if they have saved enough for retirement.  It may be the right time to speak with a licensed reverse mortgage loan advisor to see if you can take advantage of the equity you have built up in your home and give yourself peace of mind with financial security.  Call 800.976.6211 for a free reverse mortgage evaluation.





4 The reverse mortgage loan balance grows at the same rate as the available line of credit. Line of credit growth occurs and is only a benefit when a portion of the line of credit is not used. The unused line of credit grows over time and more funds become available during the life of the loan.

5 This disbursement option is only available for a fixed rate loan.