We just discovered a pair of related articles on an industry website called Reverse Mortgage Daily that help shed light on what many believe will be an upcoming explosion in Home Equity Conversion Loans, or HECM’s – the technical term for reverse mortgages. These articles could provide you with food for thought if you’re a qualified homeowner considering how a reverse mortgage could help make it possible for you to stay in your home in your future years, a choice called “aging in place.”
The first article refers to a recently released survey of seniors by Freddie Mac (the Federal Home Loan Mortgage Corporation). In their 55+ survey, they discovered that those in that age group (including almost all the baby boomers) control an astonishing $8 trillion in America’s home equity. What’s more, these seniors seem to have a strong desire to stay put. The Freddie Mac study states that around 60% of 55+ adults are “very satisfied” with the communities where they live and nearly two-thirds feel the same about the home they’re living in. A similar number definitely want to age in place if they have anything to say about it. (You can read an article about the Freddie Mac study by clicking here.)
The second article echoes something we’ve talked about on the radio and reported on our blog before. It points out that one of the most practical ways for a senior to be able to age in place is to use a reverse mortgage to fund the kind of home upgrades that will make that choice possible. Sadly, however, whether it’s through denial or uncertainty, some people wait too long before deciding to modify their residences. “When aging, many people don’t consider making the necessary changes to ensure their future needs until it’s too late, and upgrading their home for aging in place often falls into this category,” says Reverse Mortgage Daily.
Click here for the second Reverse Mortgage Daily article, describing some of the home renovations that will help seniors age in place – renovations an HECM can help pay for.
No doubt the reasons people keep putting off home renovations vary. Upgrading and remodeling a home is not only costly, it’s disruptive – just ask anyone who has tried to live in a house while going through a major remodel. (We have one acquaintance whose family spent an entire summer a few years ago with the kitchen temporarily relocated to the carport.) The problem is, the longer you wait, the harder it will be to cope with that disruption. “People don’t want to take the time and have renovations done until they are already in a less than ideal situation” caused by age and health issues, says Reverse Mortgage Daily. In this case, you may find that waiting too long to upgrade your home will make it impossible for you to keep living there as you age.
The great news is that there may be less and less reason to put off home upgrades. As reverse mortgages become more secure and more widely recommended, these financial tools are proving to be a highly popular way for seniors to be able to afford the renovations they need to stay in their home for the long haul. If aging in place is your dream, as it is for almost two-thirds of seniors, but your present home will need better lighting, redesigned bathrooms, wider hallways and more accommodating kitchens – just a few of the many upgrades seniors tend to require – a reverse mortgage could very likely be the perfect solution.
As with every aspect of retirement planning, you need the services of an expert – not a random website or a well-meaning but ill-informed friend. Here at AgingOptions, providing those objective services is our job. We want to serve as your planning partner and information resource as you consider all aspects of retirement, including housing, health care, legal affairs, finances and communication with your family. If a reverse mortgage interests you, we can refer you to trusted local experts (such as Laura Kiel of Kiel Mortgage) who will analyze your individual circumstances and give you an objective recommendation and personalized service.
If you are interested in the full range of retirement planning services, we’re ready to assist you.
Why not start by attending one of our upcoming LifePlanning Seminars? These free, information-packed events are held at locations throughout the area, and they are offered without obligation. A LifePlan is a fully-developed, comprehensive retirement blueprint that will help you build the retirement of your dreams. Click on the Upcoming Events tab and register online for the seminar of your choice. We’ll look forward to meeting you soon and helping you create a LifePlan of your own!
(originally reported at http://reversemortgagedaily.com)