Posted tagged ‘portland reverse mortgage’

Living the Dream . . . No Mortgage Payment

June 2, 2009

42-15717839I remember as a young lad hearing about mortgage burning parties. It was the dream at that time. . .  to pay off the home prior to retirement and have no more mortgage payments. Today, though many in the younger generation have attempted to use home equity as leverage in creating wealth, seniors are continuing to live with the goal of paying off their home during or prior to retirement. This frees up cash so that they can afford to live a relatively similar standard of living in retirement as they had prior to retirement.

Reverse mortgages provide yet another option: Instead of waiting to payoff the last bit of mortgage balance, it allows them to take advantage of the freedom of having no mortgage payment . . .  gauranteed for as long as the home is the primary residence. In addition to having no mortgage payment, it allows them to use whatever is left over, as an emergency fund to take care of any of the surprises that life throws them.

For those who don’t have critical plans for the use of their equity after they pass, a reverse mortgage allows the benefit of realizing no mortgage payment coupled with a stash of cash to be used at the discretion of the homeowner. What a great alternative!

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My Longest Living Reverse Mortgage Client

April 25, 2009

FOW088My longest living client called me the other day. Three years ago I helped her with her reverse mortgage. At that time she was 96 years old. I met with her and her nephew and explained all of the benefits of a reverse mortgage, as well as all of the future implications. She had had her home free and clear and simply needed to supplement her income and have some money left on the side for emergency purposes. A very common situation.

Today she is 99. She called me and in her sweet voice said, “This is Mary Smith . . . do you remember me?” Well, of course, I remembered her. . . . how could I forget her? Though she is 99, she still gets around. Her favorite thing to do is to gamble. Now she doesn’t do it real often, but she has a friend that takes her to the casinos periodically. In fact, the last time she went she won $1,000. But of course, she decided to give it back.

One of Ms. Smith’s favorite things to do is to garden. Even at 99 she keeps up her yard, getting on her knees, and working the soil so that it produces the best harvest possible. She told me that she has done it since she was a little girl. Her mother taught her all of the ins and outs of gardening, and she still loves it today.

My favorite memory of Ms. Smith is how she gets around the house. Yes, she is 99, but she pushes a walker like there is no tomorrow. She knows where she wants to go and she gets there without a bump in the road. Ms. Smith also loves to do puzzles. I suppose that that is why she is so sharp. Her mind is incredible.

It is a gift to be a part of the lives of my clients. We talk periodically and I continue to assist them in any way that I can.  With all of the lender issues occuring today, they are often concerned that the economic conditions will effect their prized reverse mortgage.  I am always happy to tell them that they are safe and secure!

If You Had a Friend . . . .

April 7, 2009

j04030581What an amazing experience I had today! I often will drop into local professional shops of planners, tax advisors, attorneys, etc., introduce myself and try to get to know someone in the company so that I can develop a professional relationship. Who knows where those contacts go. If I really connect with them, it is great. But most of the time I just leave some information behind for them to read, then reconnect with sometime in the future.

Today I walked into a tax advisors small business. It looked like the kind of place that many local seniors in the community might go to. Just like a small town shop. Tax advisors work with seniors and know about their financial situations. It is my hope that they see a need and pass on my information so that I can help improve their financial situation.

But this place was amazing . . . I walked in and introduced myself and the company that I represent. So far, so good right? Then the man said, “I hate reverse mortgages.” Taken back, I asked, “Oh really . . . what do you know about them?” You know what he said . . . . .  ” I don’t know a thing about them, and I don’t want to  . . .  but God Bless You!” Wow . . .

Now sometimes I’ll ask more questions, but I didn’t want to be a nuissance anymore than I already was (to them). So I just said, “And God Bless You,” and walked out.  I couldn’t help but think . . .  “what if I had the solution to his problem?” What if I held the answer in my hand that would make his life less stressful, and at peace. Financially speaking, when we are stressed, our whole life is a challenge . . . right? And this was a tax advisor.

It is amazing how some people simply don’t want to know the truth. Whether what I have is anything they need is not really the question . . . but to say that you don’t want to know about it when it may be the solution you are looking for is downright amazing. What if he had a close friend that could be helped? What if a neighbor relies on his expertise to help him? We close the door to helping anybody when we refuse to know the truth.

Cash Flow Advantage = Tax Free Income

April 3, 2009

eaglefinancialgrp1Recently I was handed an article from a friend from the magazine Portland Home. In the Feb/March 2009  edition, Eagle Financial Group (EFG) wrote an article about reverse mortgages. I was very impressed! Today we are seeing  that financial advisors are getting asked a lot of questions about this unique method of increasing cash flow. EFG did a nice job on the article and actually brought up a benefit of reverse mortgages that I haven’t commented much on. . . . the issue and benefit of tax free income.

One of the ways in which reverse mortgages are used is to receive a monthly income (draw) that is guaranteed for as long as the homeowners remain in their home.  Based on the value of the home and the equity available, this could range from as much as $2,000 per month or more. Eagle Financial Group brought up the point that one could decrease the amount of income recieved from other means, that is taxable, while increasing the tax-free income from the reverse mortgage. This would lower the amount of taxable income yet keep the total cash flow level (if you so wish). It provides some flexibility in the amount of taxable income one recieves, and could kep one in a lower tax bracket during retirement. Now wouldn’t that be nice!

Now that this product is getting the attention of the financial advisory world, it appears that there is becoming more creative means of using the reverse mortgage as a legitimate tool for retirement planning.  If your financial advisor is not aware of the details surrounding reverse mortgages, feel free to share my blog with him/her. As a teacher at heart, I enjoy working with financial advisors and helping them to provide solutions for their clients.

When Social Security Isn’t Enough

December 7, 2007

j0422392.jpgIt seems like every time I turn around, whether it be an advertisement, or simply a conversation with friends, I am reminded to develop a savings plan and stick to it! Whether it be saving for retirement, or saving for an inevitable event, we live at a time where the future is more and more unpredictable. With the instability of the world and the ever increasing cost of living, it is prudent to plan for the future, wherever life takes us. 

As a Certified Senior Advisor, I meet with many seniors who grew up in an age where planning for retirement was more or less having a pension and supplementing their retirement with social security income (or vise versa). In the day, one of the common worries was “Am I going to live long enough to enjoy my retirement.” Today, the common concern is “Will I have enough money to live throughout my retirement.” Or, stated another way, “Will I live too long?” Not simply just to survive, but to live in an independent way to enjoy life. When the savings runs dry, what are some strategies supplement social security to keep up with all of the demands of growing older? 

When evaluating financial products that can help to supplement income, most financial advisors will look for investment products that can provide a guaranteed “rest of life” income. For many seniors, this works well, and financial advisors have a myriad of products to help accomplish this goal. However, in order to take advantage of these programs, one has to have a lump sum of money to invest. Unfortunately, not everybody has the $50,000 to $100,000, or more, to invest. So, what else is available in order to supplement income and/or provide an emergency fund for unexpected events? 

As a Reverse Mortgage Specialist, I have worked with many seniors that are in the situation described above. The life savings has been spent and the quality of life has become a struggle trying to find peace in the midst of life’s financial storms. Though reverse mortgages have been around for many years, they are beginning to catch on as a viable financial product and provide the “peace-of-mind” for many seniors.  So, what is a Reverse Mortgage? In short, it allows senior homeowner’s 62 years old or older to use their home equity as an income source. Some of the main benefits of a reverse mortgage are:  

  • You retain full ownership in your home (Title does not change) 
  • No monthly payments
  • Can provide ongoing lifetime income.
  • Money received is tax-free
  • No financial requirements to qualify.
  • Does not affect Social Security or Medicare. 
  • No restriction on use of funds available.
  • You may continue to live in your home for the rest of your life.
  • Can receive the money in a variety of ways (i.e. lump sum, LOC, income)
  • You will never owe more than your house is worth.
  • Remaining equity will go to your heirs.

There are a variety of reverse mortgage products available. Each one is a little different, so it is very important to communicate to your advisor what your ultimate goal is in getting a reverse mortgage. Secondly, there are strategies one can use in order to preserve a portion of your equity, if that is a concern. Most importantly, however, is to learn about reverse mortgages as a part of a complete retirement plan. Though one may never need it, it is a great solution for many who find that their monthly cash flow is falling short.

Always feel free to contact me if you have any questions about reverse mortgages. You can contact me at greg.gulliford@pmrmtg.com or toll free at 1-888-480-6636.