The Good, the Bad, the Beautiful – Reflections on Life

I have a confession: as my nearest and dearest can attest, I have to work at just sitting and “seeing.” It’s the notable downside of being a doer. When I look at something I immediately start breaking it down into constituent parts, tasks, responsibilities…whatever. Give me a mess to solve and my cup overfloweth.

Schlepping with me this elemental piece of baggage, this morning I strode down the hill and entered my garden.

Hang with me here – this story is going somewhere.

First, a little background

My garden has been a decade-long rehabilitation of the stream feeding our pond. When I began the project, the entire area was a tangled mess of pernicious non-natives: tree of heaven, honeysuckle, stilt grass, black mustard, curly dock. Over the years I eradicated invasives, cleared the choked stream bed, and reintroduced some 30 Virginia native plant species rescued from areas slated for development. Gradually over the years it became a healthy, thriving, native wetlands habitat.

And then cometh the flood

Relentless rain fell throughout the night Sunday and into Monday morning. Living on a pond, high water is nothing new; this rain, however, was unusually heavy. As I walked down to the pond evidence lay everywhere that the stream had overtopped the road: tattered leaves, stones, and blue-bellied fingerlings lay in great, sweeping “W’s” across the pavement, heaping into furrows where the pavement meets the roadside grasses.

Then I entered the garden itself to view the post-flood damage.

And what damage. At first glance all I saw was an Armageddon of sand, stone, and mud – lots and lots of mud. My beautiful natives all appeared gone, now replaced by slick sludge and rock. My little wooden bridge was nowhere in sight, it, too swept away in the night. Close examination showed most of my natives were actually still there, just crushed and deeply buried. Instinctively I set to work engineering in my mind what to tackle and how.

But – marvel of marvels – before setting to work I forced myself to sit and “see.”

And this is what I saw: on the moist banks, on every rain-soaked branch, even on the wrought-iron garden archway sat butterflies, scores of butterflies, fanning in the morning light. Some twitterpated threesomes tumbled in the air, while others sniffed at me, the big, white foreigner in mucking boots sitting on the sodden bench. The roots of the giant sycamore had been scoured clean and now lay stunningly white, like an enormous albino python basking in the sun. Overhead an oriole nest bobbed in the morning breeze.

A shuffling noise caught my attention: a huge, lumbering snapping turtle plodded toward me. Several times the green heron shot back and forth across the swollen pond. A goldfinch landed on a nearby seedpod, and in the distance scores of songbirds called.

Life, life everywhere, surrounded me despite the storm, the flood, the fury.

The hopeless situation I had feared I’d find I did not. Instead I found a garden newly scoured but newly shimmering, newly undone but newly recreated, newly rich and delightfully vibrant.

Then the thought occurred to me: my garden is a parable, a reflection of life.

Life is change

Change, at first, rarely looks good. Change is often hard. And in the ever-changing world of financing retirement, change can be particularly hard.

During retirement conditions constantly change. Needs constantly change. Lives constantly change. It’s just part of life – but in the retirement years, life’s changes can be uniquely challenging, and more options are needed. And it’s here that a reverse mortgage can be pretty darn near a life-saver.

As I’ve said many times, in retirement no one is going to get by on just their Social Security. No one is going to make it on their 401-K. Few are going to survive on their pension, their annuity, their IRA, their bank account – or their reverse mortgage. But when added together, all these combine to create a long-term means of maintaining dignity and independence in retirement.

If you would like to explore how an FHA-insured reverse mortgage might help with your retirement plans or those of your loved ones, give me a call. I always love hearing from you.


Laurie MacNaughton [506562] is a freelance writer and Reverse Mortgage Consultant. She can be reached at 703-477-1183 Direct or

Fed Survey: One-Third of U.S. Households Unprepared to Retirement


 Reposted from National Reverse Mortgage Lenders Association, ©2014
The Federal Reserve Board published the results of a new online survey this week, which found that 31 percent of non-retired respondents have no retirement savings or pension, including 19 percent of those ages 55 to 64.

Additionally, almost half of adults were not actively thinking about financial planning for retirement, with 24 percent saying they had given only a little thought to financial planning for their retirement and another 25 percent saying they had done no planning at all. Of those who have given at least some thought to retirement planning and plan to retire at some point, 25 percent didn’t know how they will pay their expenses in retirement.

According to the survey, the Great Recession pushed back the planned date of retirement for two-fifths of those ages 45 and over who had not yet retired, and 15 percent of those who had retired since 2008 reported that they retired earlier than planned due to the recession. Among those ages 55 to 64 who had not yet retired, only 18 percent plan to follow the traditional retirement model of working full time until a set date and then stop working altogether, while 24 percent expected to keep working as long as possible, 18 percent expected to retire and then work a part-time job, and 9 percent expected to retire and then become self-employed.

The survey was conducted on behalf of the Board by GfK, an online consumer research firm. Data collection began September 17, 2013, and concluded on October 4, 2013. Just over 4,100 respondents completed the survey. To view the survey’s key findings visit

Reverse Mortgage : A bad idea whose time has come? Hardly.

By all accounts, my dad was a funny guy. Looking every bit the part of the aerospace engineer he was by profession, no one ever expected him to have a piercing sense of humor or the ability to capture just the right turn of phrase – but he had both, and his humor was often profound.

One funny phrase he used occasionally was “a bad idea whose time has come.” He did not say this often, but an example of something fitting into this category might have been the Stuxnet software worm, if he had lived long enough to see it.

So why in the world do I bring this up?

This past week I received a call from a private wealth advisor who referred a client. While on the phone the wealth advisor said, “I always thought a reverse mortgage was a bad option people turned to when they were desperate. But during this month’s advisors’ meeting, reverse mortgage was suggested as a potential element of a well-rounded, long-range retirement plan.”

Bingo, my friend.

And more than ever, right now there are truly profound reasons to consider a reverse mortgage.

First is this: few financial experts anticipate interest rates will stay low. With a reverse mortgage, there is not a monthly mortgage payment, so that’s not how rates figure in. However, interest rates impact how much money the client receives – and even a small rate increase negatively impacts how much money the homeowner can access. In fact, if rates go up to 4.06% – which for much of history would be a modest rate – there would be a 26% drop in funds available to someone aged 68. That’s a hefty reduction.

A second consideration is that a reverse mortgage may enable a senior to delay drawing Social Security until age 70, when benefits are maximized. Most of us have seen the charts and know how much money we walk away from if we start drawing benefits at 62; less well-known are strategies available to help avoid an early draw.

A third thing to consider is this: there is an automatic growth rate associated with a reverse mortgage line of credit. This, in my opinion, is the least-known element of a reverse mortgage – and that’s a darn shame.

Each month, the unused portion of a reverse mortgage credit line grows bigger. This means that if you establish a line of credit now and let it sit until you need it, month over month the credit line will be bigger than it was when you originated.

Right now, more than ever, a reverse mortgage is a good option – whose time has come.

As I’ve said many times, no one is going to get by on just their Social Security. No one is going to make it on their 401-K. Few are going to survive on their pension, their annuity, their IRA, their bank account – or their reverse mortgage. But when added together, all these combine to create a long-term means of maintaining dignity and independence in retirement.

If you would like to explore how an FHA-insured reverse mortgage might help with your retirement plans, give me a call. I always love hearing from you.


Laurie MacNaughton [NMLS# 506562] is a freelance writer and a Reverse Mortgage Consultant at Middleburg Mortgage. She can be reached at: 703-477-1183, or


Weekly Scenario

Steven E. Shane, Esq. | © 2014 Offit Kurman, Attorneys At Law | Used by permission                                

Question:  My son lives across the country but is my health care agent.  He has a copy of my advance medical directive.  I’m concerned that if I am admitted to the hospital suddenly, or there is a medical crisis, he may not be able to quickly deal with the situation.

Answer:  An advance medical directive gives instructions as to the type of medical care you would like to receive in the event you cannot express those wishes yourself.  The document can also give another person the ability to make medical decisions for you.

The document, however, is not helpful if it is locked away at the bank or in your attorney’s office.  One solution [for dealing with this problem] is with a new app called “My Health Care Wishes.” This app allows one to import and store important health care documents on a smartphone so they are accessible when needed.

So in this scenario, your son could keep the information on his smartphone.  If there were an emergency, you would have a “My Health Care Wishes” wallet card stating your son has your medical proxy documents.  He would access and send that document quickly, and then have the authority to speak with the medical facility and make decisions.

Two other apps available are DocuBank and MyDirectives.  I have also seen articles which advise using a phone or tablet to simply store documents in a cloud-based storage system.

Comment:  One issue to be wary of is the security of these legal documents.  My hope is that these apps have worked on the security issues, but I can’t comment on whether that has actually taken place.

As always, if you have any questions or would like to learn more, please let me know.

Steven E. Shane                                            
Principal Attorney                                              
Attorneys At Law
8171 Maple Lawn Blvd. | Suite 200 | Maple Lawn, MD 20759 | 301.575.0300


Please note the above material discussed is intended to provide only general information.  Do not, under any circumstances, solely rely on this information as legal advice. Legal matters are often complicated.  For assistance with your specific legal problem or inquiry please contact me directly.

Low Interest Rates, Low Inventory, and a Slow Market? Huh?

Laurie MacNaughton [NMLS# 506562]

Low interest rates, low housing inventory, and a slow housing market? In what kind of crazy world do these three conditions exist simultaneously?

At last week’s 2014 Finance Summit, hosted by Northern Virginia Association of Realtors (NVAR), Joseph Minarik, research director for the Office of Management and Budget, explained how we got where we are.

According to Minarik, interest rates have been so very low for so very long most people who were going to refinance have done so. Additionally, some buyers moved up their home purchase to take advantage of historically low rates. So in effect, very low rates caused the market to borrow homebuyers from the future. Now rates have edged up slightly, and homeowners are loath to purchase a new home and forfeit their low rate. This not only impacts the sale of previously owned homes, but since fewer people are willing to move, it also impacts new home starts.

And how has this impacted the housing market? Basically since the middle of 2013, the pace of home purchases has been stalled. This includes new home starts.

But there was good news out this week: for the first time all year, April’s home sales were up.

Several factors have come together to create a better housing market, according to Steve Farbstein, Chairman of the Mortgage Executives Committee of Virginia Bankers Association. One such factor is the loosening of lending standards by some lenders. Additionally, certain loan products that had been unavailable have started to reappear, giving borrowers with unusual circumstances a better chance of qualifying.

Though a loosening of lending standards may help homebuyers who are in their working years, many senior homebuyers still cannot qualify for a traditional loan. Often this is not because they have adverse credit issues. Rather, it can be next to impossible to get a loan if the applicant is not actively employed.

But here’s the thing: it’s not that seniors are unemployed. They’re retired. But either way, in many cases they’re still not getting that loan – and as a reverse mortgage specialist, it’s the retired, or those who are planning to retire soon, I’m concerned about.

There actually is a purchase loan just for seniors. It’s called the HECM for Purchase loan, and it was designed specifically with seniors’ needs in mind. With the FHA HECM for Purchase there is a down payment, but there is never a monthly mortgage payment due. And, though guidelines will soon tighten, as of right now qualifying for a HECM for Purchase loan is based upon the borrower’s age and the purchase price of the home. Also, in many cases it’s ok if there is still an “exit” home that has not yet sold. This gives seniors time to make any necessary repairs or upgrades to the “exit” property after they have moved into their new home.

The housing market is starting to budge, and there is no reason seniors should be left behind. Now while rates are low it’s a great time for seniors to get into a home configured to suit their needs in retirement.

Give me a call and let’s talk. I always love hearing from you.


Laurie MacNaughton[NMLS# 506562] is a freelance writer and a Reverse Mortgage Consultant at Middleburg Mortgage. She can be reached at: 703-477-1183 Direct, or




Weekly Scenario


My wife and I recently looked into doing a reverse mortgage, but were told we don’t qualify for enough to pay off our existing mortgage. Do we have any options?


This situation is called “short to close,” and it refers to the exact scenario you are encountering, namely one in which your current “forward” mortgage is too large to be paid off by the proceeds from the reverse mortgage.

You do still have options. The most common solution is to bring money to closing to cover the shortfall.

Here’s an example in real numbers:

John and Dianne are each 64, and their plan is to retire within the next 6 months. Their home is appraised at $400,000, and they owe $203,000 on their current mortgage.

Assuming current interest rates and average closing costs, the amount they qualify for leaves them about $5,000 short of what they need in order to fully pay off their forward mortgage.

They are allowed to bring that $5,000 to closing in order to make the reverse mortgage work. The funds to cover the shortfall can come from any non-loan source, including savings, sale of an asset, or a gift from adult children.

And what is the benefit of doing this? The obvious benefit is that they have no more monthly mortgage payment. Since most Americans’ largest monthly expense is their mortgage payment, eliminating that expense frees up a significant amount of money on a monthly basis.

But there are side benefits as well, including safeguarding the home in the event one spouse dies and the surviving spouse loses the retirement income generated by the late spouse. Even with the loss of income, no payment on the loan is due until the last person on the home title moves, sells the home, or dies. At that point the heirs have up to one year to decide whether to sell or to refinance the home.

If you have reverse mortgage questions, give me a call. I always love hearing from you.


Laurie MacNaughton [NMLS# 506562] is freelance writer and Reverse Mortgage Consultant with Middleburg Mortgage. She can be reached at 703-477-1183, Direct, or at

Middleburg Mortgage ∙ 8190 Stonewall Shops Square ∙ Gainesville, VA ∙ 703-477-1183 Direct


Approaching High Tide

So here’s a nifty term I learned this week: “Dependency Ratio.”

This term appears in this month’s U.S. Census Report entitled The Baby Boom Cohort in the United States: 2012 to 2060, and it measures the youngest and oldest members of the population relative to the number of those of working age. The smaller the dependency ratio the better. Or, turning the equation the other way around, the larger the dependency ratio, the worse it is for the economy.

And why?

Because workers work – and workers earn. Dependents, on the other hand, depend on earners. That’s why they’re called “dependents.”

And who are these dependents? They are both the young and the old – those who have not yet entered the workforce, and those who have retired from it. In fact, the dependency ratio is split into two segments, the “youth dependency ratio” and the “old-age dependency ratio.”

According to the U.S. Census Bureau, the youth dependency ratio topped out in 1964, when there were 67 children for every 100 working adults. By 1999, when boomers were in their peak earning years, the dependency ratio was under 37, its all-time low.

The Rising Tide

Old-age dependency ratios are also a function of the baby boom. In 1945 there were 12 older Americans for every 100 workers; by 2010 there were 21. By 2030 the combined dependency ratio will hit high tide, when it is projected to top 75.

Need I say it? That’s a lot of dependents.

And here’s the thing about dependency: in 15 years, 15-year-olds will be 30. With any luck at all they will be working, living on their own, furnishing their own homes or apartments, and entering their peak purchasing years. They will also be healthy.

Contrast this with 65-year-olds. In 15 years they will be 80. Typical 80-year-olds are not working, not buying new homes, and not buying new goods at the pace they once did. Furthermore, few 80-year-olds are healthier than they were a decade and a half earlier.

By 2030, the last of the baby boom cohort will have turned 65. In that same year 1 in 5 Americans will be 65 or older. An historically large old-age ratio will increase old-age dependency – and is likely to squeeze government agencies and families alike as they attempt to meet the needs of the elderly.

We’re all making this up as we go: never before have we or our parents, never before has the nation, or indeed the world, faced this dynamic. It’s going to take creative solutions, combined efforts, and flexible options to meet the needs of those we love.


Laurie MacNaughton is a freelance writer and a Reverse Mortgage Consultant at Middleburg Mortgage. She can be reached at: 703-477-1183 Direct or


Laurie MacNaughton [NMLS# 506562] ∙ Reverse Mortgage Consultant, President’s Club ∙ Middleburg Mortgage ∙ 8190 Stonewall Shops Square ∙ Gainesville, VA 20155 ∙ 703-477-1183 Direct ∙