R.E.S.P.E.C.T. Reverse Mortgages
The lack of respect for reverse mortgages continues even as many older Americans, who have used them, continue to rave about their benefits.
One couple in particular, Bob and Fran Ciaccia, have taken full advantage of the reverse mortgage they took out in 2005. Using the $120,000 HECM loan they obtained, on their $220,000 home equity, the Ciaccias bought a recreational vehicle (RV) to travel their home state of Pennsylvania and saved the rest in a line of credit for future expected (and unexpected) expenses.
Older Americans aren’t taking advantage of the reverse mortgages though. In fact, according to AARP, only about 1% of older Americans utilize a reverse mortgage.
In an article published by Reverse Mortgage Daily, “No Respect for Reverse Mortgages?”, which talked about the Ciaccias’ story, however, reverse mortgages are given the credit they deserve because they significantly improved the Ciaccia’s life, retirement and helped them use the equity they have been accumulating since they bought their home in 1966.
One concern, the article notes, is inheritance. The Ciaccia’s discussed their decision with their three grown children and came to the decision that their children would not need their money later in life. However, a reverse mortgage doesn’t bind you to use all your equity at once. In fact, it suggests that you only take what you need and save the rest for later. When the loan becomes due, the remaining home equity goes to the heirs, after the loan has been repaid in full.
This is one of the benefits of the elimination of the Standard Fixed-Rate Reverse Mortgage.
In the past, homeowners would use up their home equity from the get-go and would not have enough to pay their financial obligations, such as homeowners’ insurance and property taxes. Presently, the reverse mortgage continue to improve, based on past consumers’ experiences, so that more stories like the Ciaccias continue to happen.
The most important factor is EDUCATION. At PS Financial Services we stress the importance of MANDATORY reverse mortgage counseling because we believe our clients should always know what every document they are signing means. The Ciaccia’s story demonstrates how educated consumers and ethical brokers, working together, can close a deal that benefits every party involved.
Interested in a reverse mortgage? Give us a call at (888) 845-6630 or email us at info@PSReverseMortgage.com. We do not pressure those who inquire, nor is there an obligation for our services, we are simply here to help.
Click here for more information about the elimination of the reverse mortgage program as we know it: