Why Reverse Mortgages Are Not The Answer

 

Over the past 7 years, I have been protecting the interests of seniors.  This passion started when I witnessed 2 delightful ladies in a car dealership.  Business had been slow so when these ladies walked into the dealership the sales manager saw the perfect opportunity. What should have been a payment of 259.00 a month ended up being 649.00 with every insurance known to mankind applied.  It was at that moment as a Rotarian that I knew that someone had to do something.

I created Everything 4 Seniors as a concierge company to help seniors buy services without being taken advantage of. Taking this protection online Find Help 4 Seniors was created.  Find Help 4 Seniors was an online directory… the largest one in North America comprised of Senior Friendly companies, a sort of Good Housekeeping Seal of Approval for companies that swore to  protect the interest of their senior clients . If such promises were made they were able to list their business for free.

 

When, by accident, this directory was erased, I return to selling real estate.  With my background rich in helping seniors I became aware of some of the financial issues seniors face and  through the personal experiences of my parents.  As retried homeowners they were not entitled to a line of credit as there is an income requirement that needs to be met in order to qualify.

Therefore, the options at that time were 1. Reverse mortgage or 2. Downsize.  My father chose a reverse mortgage as they still wanted to stay in their beautiful home.  After only 2 years my father  realized how quickly the interest was accumulating and decided to sell and downsize after all.  It was amazing how much equity was ate up by the reverse mortgage.  Now being able to afford much less because the equity that they had accumulated for years had been devoured in a short time. He didn’t realize that the solution laid within the home equity, but selling it to investors and then renting back.  The rental amount was comparable to the dividends he would have been able to receive.  So his equity would remain topped up.

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Returning to real estate with a niche interest in Seniors financial issues I started to figure out a way to access the 100% of the equity without losing it to interest charges and so a retired homeowner could stay in the home they enjoyed.  Sell ‘n STAY was the net result.   A concept with the senior’s interest front and center.  In the blog information to follow I will lay out what are the pros and cons of Sell ‘n STAY versus the other options like reverse mortgages.

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