The Wildflower Group is pleased to welcome guest blogger Shana Judd, Reverse Mortgage Specialist!
Susan and Ted had been married for over 30 years and lived in a beautiful, well established neighborhood in Denver, Colorado where the homes sell for over $800,000. The couple had a fun lifestyle; traveling and frequently entertaining friends. Susan was 66 and Ted was 70. They had decided to retire in the upcoming year. In addition, they had successfully blended their families 30 years earlier. Now with grown children, Susan thought they were on-course for their retirement years. Susan was shocked when she came home one day to find divorce papers on her kitchen counter. Ted was divorcing her because he had met someone new. Susan was in total despair and disbelief. Her world crumbled and she was very scared about her future.
During the marriage, Susan was devoted to caring for the children, their aging parents and their home and still managed to work part-time. She sacrificed critical full-time income earning years to take care of her family and was able to save a very small IRA. Susan had been counting on Ted’s income for their retirement years. Now that Ted had filed for divorce and they had agreed to sell the marital home, Susan knew she had to focus on getting her finances in order.
Susan had heard about the NEW HECM (Home Equity Conversion Mortgage) for purchase or also known as Reverse Mortgage for Purchase from her Realtor. When Susan and I first met, I explained how using the reverse mortgage loan to buy her new home would preserve the cash from the sale of the marital home and her divorce settlement. She will never have a mortgage payment on her new home and only be responsible for the property taxes, home owner’s insurance and maintenance. She will also keep the title to her home and retain full ownership.
Susan found a new home for $450,000 and with the HECM for purchase program was able to purchase the home just by bringing her down payment to closing. The reverse mortgage loan covered the difference between her down payment and purchase price. Susan will never have a mortgage payment and is only required to pay the property taxes, home owner’s insurance and maintenance.
There are two major benefits for Susan choosing the HECM for purchase program. First, she has more monthly cash flow because she doesn’t have a mortgage payment. Second, she saves her cash by only having to come to closing with a down payment. If she bought the home for cash, Susan would have tied up her savings. By using the reverse mortgage Susan was able to preserve her cash and keep it invested. The NEW reverse mortgage for purchase program allows Susan to buy the home she wants, preserve cash from her settlement and eliminate the mortgage payment forever.
The benefit of using a HECM for purchase to buy a home is that it allows the buyer to keep more cash in their savings. This is very impactful for retirees who need to keep assets preserved. With people living longer than ever before in history, the biggest fear is running out of money. The down payment required for HECM for purchase is between 50% to 60% of the purchase price. Since the reverse mortgage program was completely re-structured and re-released in 2012, there have been thousands of white papers published showing the positive results for reverse mortgage. The home owner must be at least 62 years of age and meet credit and income requirements.
Let’s get in touch and talk about how your house can go to work for you!
Shana Judd, Reverse Mortgage Specialist, NMLS 250580
Retirement Funding Solutions NMLS 1025894
For more information about Reverse Mortgage, please contact Shana Judd, Reverse Mortgage Specialist at (303) 918-7013 firstname.lastname@example.org
Below are a few resources on reverse mortgage: