One of the things I pride myself on as a Real Estate Broker and owner of West Los Angeles Real Estate Group is to provide knowledge and information that help my clients make important decisions about Real Estate Transactions. One of the most interesting ways for Seniors to protect not only their Real Estate holdings but their retirement funds is with a Revers Mortgage
In these economic hard times the Recession has been very hard even in the wealthy areas for owners of Brentwood Houses or Santa Monica Condos. Many seniors live in West Los Angeles Real Estate Group’s areas of expertise and include Pacific Palisades and Bel Air.
A reverse mortgage historically has enabled senior homeowners to convert part of the equity in their homes into tax-free funds without having to sell the home, give up title, or take on a new monthly mortgage payment. Reverse mortgages are available to individuals 62 or older who own their home.
After speaking with a Wells Fargo banker about “Reverse Mortgages” he said a stock answer when applicants declined a reverse mortgage was because they felt the rates and fees were simply too high.
If this is true then they should be comparing the costs and work that go into selling your home, paying the closing costs, and then attempting to find another acceptable place? Did you ever try to find a place for a senior? Especially if it is part of your family, I did and it is something that I would not want to do again.
Statistics are showing that seniors have fared among the worst these past three years during the recession. Here are some facts that I read from the AARP
- 67% of seniors approaching retirement has had to dip into there retirements
- 32% have experienced a major decline in their houses value
- 25% have used up all of their personal savings
If those older borrowers had taken out a reverse mortgage three years ago, chances are they would not have exhausted their personal savings or tapped as much into their retirement accounts. They could have had a lump sum reverse mortgage, a monthly draw, a line of credit, or any combination of those, yet have made no payments.
There are many new laws and regulations for Reverse Mortgages and you need a good Realtor and Banker to work with you to see if it is right for you. If you are approaching retirement or know someone who is please call me at 310.505.5571 or email, bob_schmalz@wlaregroup.com
