Historically, home values in Los Angeles, California have been significantly higher than the national average. Using data pulled September 30, 2018, Zillow shows the median home value in Los Angeles at $679,200 and the median home value in the U.S at $275,000.1 Home values are not the only thing that is above average in Los Angeles. The city’s cost of living is also considerably higher than average.2 Los Angeles is home to over 1.3 million seniors, some of whom may be able to take advantage of a unique financial product called a reverse mortgage.3 A reverse mortgage in high cost of living areas like Los Angeles may help seniors cope with the city’s high cost of living.
Available to senior homeowners 62 years of age and older, a reverse mortgage allows them to access a portion of their home equity as cash without having to make monthly mortgage payments.4 There have been 444 seniors who have gotten a reverse mortgage loan in Los Angeles so far this year. The table below shows other popular cities for reverse mortgages in Southern California and the number of originations so far in 2018:5
|Southern California City||2018 Reverse Mortgage Originations|
Reverse mortgages may allow seniors to experience less financial anxiety by providing an extra source of funds. Some common uses for reverse mortgage funds include supplementing retirement savings, covering medical expenses, and setting up a line of credit that grows over time.6 Some seniors even choose to use the loan to purchase a new home.
Seniors today are living longer and healthier lives than previous generations. As their lifestyles evolve around retirement, they are finding that they may need more money than they had initially planned for. If you are a homeowner 62 or older in Los Angeles, California or another high cost of living area, a reverse mortgage may be able to help you supplement your retirement income. Try our reverse mortgage calculator above to receive a quick estimate of how much you may be eligible to receive, or call 1 (800) 976-6211 to talk to a licensed loan advisor.
1Zillow. Log Angeles Home Prices & Values Add date/time pulled b/c this link will update as the index changes. https://www.zillow.com/los-angeles-ca/home-values/
2BestPlaces.net. Cost of Living in Los Angeles, California. https://www.bestplaces.net/cost_of_living/city/california/los_angeles
3United States Census Bureau QuickFacts Los Angeles Country, California. Population: 10,163,507 Population 65 years and over: 13.2% Persons 65 years and over: 1,341,582 https://www.census.gov/quickfacts/fact/table/losangelescountycalifornia,ca/PST045217
4You must live in the home as your primary residence, continue to pay required property taxes, homeowners insurance, and maintain the home according to FHA requirements. Failure to meet these requirements can trigger a loan default that may result in foreclosure.
5 Department of Housing and Urban Development. HUD FHA HECM Single Family Portfolio Snap Shot. https://www.hud.gov/program_offices/housing/rmra/oe/rpts/hecmsfsnap/hecmsfsnap
6The 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.