Laurie MacNaughton © 2018 “My mother’s home was paid off, and at the time we thought a home equity line was going to be the best way for her to pay medical bills. But at this point she’s 87 and the monthly payment is crushing her. Looking back, what we really needed was a crystal ball.” If you have an older adult in your life, you’ve heard a similar story a hundred times. No honest lender is ever going to tell you a reverse mortgage is a universally good fit: there are older homeowners for whom the time has come to sell their home and transition into other housing. Some are better served by doing a traditional home equity line of credit (also called…
Middleburg Reverse Lady
Posts from the “Retirement Planning” Category
Laurie Denker MacNaughton © 2018 Put a bunch of experience in a room and you’re going to get a good result, right? Not even close. This morning I read an interesting study: when surgeons are with a familiar team, outcomes are good. When the same surgeons are with an unfamiliar team, outcomes are…not so good. The same holds true in sports – some teams with great players cannot get it together, while others achieve magical results with less stellar athletes. And another sector studied? Financial services. Yup – financial services. Turns out, team dynamics are hugely important. No amount of experience can replace the “magic” of an established, well-functioning team. A few days ago I had a closing with a client whose reverse mortgage…
Did you know the average reverse mortgage borrower is not in financial distress? Rather, the typical person doing a reverse mortgage is the retiring boomer who watched a parent’s financial situation later in life and is determined to avoid a financial crunch down the road. And did you know there are two “flavors” of reverse mortgage, a refinance and a purchase? Typically, the homeowner doing a reverse mortgage refinance is the baby boomer putting together a long-range financial plan. The homebuyer using a reverse for purchase is looking to buy a home without pinning down a huge chunk of cash or taking on a new 30-year mortgage during retirement. A reverse mortgage is not mysterious, nor exotic, nor any more complex than any other loan. It is simply…
Can a reverse mortgage create a financial safety net?
middleburgreverselady
Posted on February 12, 2018
Laurie MacNaughton © 2018 Can a reverse mortgage create a financial safety net in retirement? In a word, yes. This morning I received a call from a wealth manager who led off by saying he wasn’t “that familiar with reverse mortgages.” He specifically wanted to know whether a reverse mortgage could offer retirement-aged clients a measure of security during market fluctuations. Here was my answer: the most familiar “flavor” of reverse mortgage is the line of credit. It’s an equity line that is repaid when the last person on title permanently vacates the home. Once the home is no longer the primary residence, typically it is sold and the loan is repaid; the homeowner, heirs, or estate get the remaining equity. End of story.…
Laurie MacNaughton © 2018 If you’re even a casual market observer, Monday’s financial news grabbed your attention as the Dow plunged 1175 points, the biggest point drop in history. As a result of the market turbulence, the first call I took Tuesday went like this: “In light of the market crash, should I do a reverse mortgage?” So…a couple things here. First, and perhaps most importantly, a loan officer is not the same thing as a financial planner, wealth manager, nor accountant; most loan officers are neither estate attorneys nor CPAs. Even if your particular loan officer does carry one or more of these designations, he or she should not be dispensing advice across disciplines, as conflicts of interest might quickly become an issue.…
Laurie MacNaughton © 2018 “My mother’s home was paid off, and at the time we thought a home equity line was going to be the best way for her to pay medical bills. But at this point the payment is crushing her – and she has new medical bills coming in. Looking back, what we really needed was a crystal ball.” Truth is, a crystal ball would come in handy in much of life. It’s just that more is at stake when we’re dealing with our aging parents. No honest lender is ever going to tell you a reverse mortgage is a universally good fit: there are older homeowners for whom the time has come to sell their home and transition into other housing. Some…
Laurie MacNaughton © 2018 Reverse mortgages…you’ve seen the ads a hundred times. But odds are you have a lot of questions. In a nutshell, here’s the scoop The first thing to know is a reverse mortgage is an FHA-insured home loan. I always start with this point simply because there can be confusion about the fact this is a home loan, in many ways not unlike any other loan we’ve all grown up with. Here’s where the difference comes in: a reverse mortgage loan is repaid when the last person on title permanently leaves the home. In fact, the very name itself comes from the fact the loan is repaid in reverse on the back-end, rather than being repaid monthly. The second thing to…
