Older Americans seeking financial security and a means to supplement retirement income are turning in record numbers to reverse mortgages as a way to convert home equity into tax-free funds. In fiscal year 2006, an unprecedented 23,271 customers took out reverse mortgages compared to 14,346 in fiscal year 2005. This represents an increase of 62 percent.
"More seniors are recognizing that traditional retirement tools, such as Social Security to pensions to retirement investments aren't providing enough income to help fund everyday living expenses and healthcare expenses," said Jeff Taylor, vice president, Senior Products Group,
"As many people approach retirement, they begin to realize their major asset is likely to be their house and by the time the average person retires, they own a home that's usually worth more than they paid for it. It's pretty amazing that a senior can receive income from their house and make it their dream retirement home, a place where they can control their independence, dignity and quality of life."
A reverse mortgage is a special type of home loan that allows an older homeowner to turn home equity into tax-free proceeds without having to leave the home or make regular monthly loan payments.
Reverse mortgage loan proceeds aren't considered income and don't affect Social Security or Medicare benefits. The loan becomes due and payable when the borrower no longer occupies the house as a principal residence. The balance can be paid from the proceeds of the home sale or refinance.
The number of reverse mortgage fundings jumped by 77 percent nationwide, according to the National Reverse Mortgage Lenders Association. The Federal Housing Administration insured 76,351 Home Equity Conversion Mortgages compared to 43,313 the previous year.
Taylor attributes the growth to several factors, including seniors having a better understanding of the reverse mortgage product, high home appreciation rates in many parts of the country; an aging population and efforts by various organizations to promote the benefits and flexibility of the product.
There is no imcome or credit required for this program.
Call 1-888-973-8377 to speak with a Reverse Mortgage Specialist or visit Reverse Mortgage Nation, a national Reverse Mortgage Lender.
Wednesday, December 06, 2006
Reverse Mortgage Growth
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