Reverse mortgages could help seniors weather economic storm
Wednesday - December 23, 2009
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Almost everyone is being affected by the nation’s troubled economy-especially those living on fixed incomes and trying to manage with diminished retirement savings. What’s more, it’s also difficult to acquire credit.
“Options such as home equity loans or lines of credit that seniors might have used in the past to supplement their finances may no longer be a viable option these days,” says Percy Ihara, CSA, reverse mortgage consultant with MetLife Bank. “Even when these types of loans were easier to obtain, the borrower still had to make monthly payments, and this can be difficult on a fixed income, no matter what the economic environment.”
Fortunately, there’s one option that could make sense for homeowners 62 or older and who’ve paid off or mostly paid off their mortgages: a reverse mortgage. “For most people, homes are their number one asset,” explained Percy Ihara, CSA “However, the equity that’s been building for years doesn’t provide a ready source of funds to pay for things like living expenses and health care costs. A reverse mortgage allows people the ability to use their equity to fulfill a variety of needs.”
Also important during recession times: A reverse mortgage does not require credit approval, and there are no monthly payments-the loan is not repaid until the last surviving borrower permanently leaves or sells the home. Of course, this doesn’t mean that a reverse mortgage is free. There are closing costs; interest accrues on the loan to be paid at the time it becomes due; and the principal amount is also repaid at that time. And, other fees and costs may apply.
Best of all, borrowers continue to own and live in their homes-with greater financial flexibility.
“Reverse mortgages have allowed many seniors to live a better, more comfortable life,” said Percy Ihara, CSA. “The key to getting the most out of this important financial tool is to get all the facts to make an educated decision. And, you want to do business with a strong and reputable company like MetLife Bank, which is a member of the MetLife family of companies.” Those interested in obtaining more information and a free, no-obligation educational video about reverse mortgages from MetLife Bank can contact Percy Ihara, CSA at 368-6747 or neighbor islands call toll-free at 1-866-369-6747.
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