A recent report by the Urban Institute titled "How Much Could Reverse Mortgages Contribute to Retirement Incomes?" states that homeowners over the age of 62 could see an 18% increase in median annual income just by using an annuity-type Reverse Mortgage. Homeowners over the age of 82 could see increases as much as 36% based on 2006 home values.
The report took a conservative approach and used interest rates in effect March 2008 & did not use the newly instated $417,000 nationwide lending limit. Using the older limit of $362,790 and accounting for a possible 10% drop in home values they used $124,500 as the median household equity to arrive at roughly a 16% gain in income.
What does all of this mean?
Simply put - it means that by using the annuity-type feature that is provided with a Reverse Mortgage, the homeowner is able to receive additional non-taxable "income" monthly. This option is not for everyone, but could quite possibly provide a much-needed boost to a homeowner's financial situation that may be above the age of 62...and have seen a recent sharp decline in their retirement assets.
I would absolutely suggest consulting a licensed Financial Advisor, prior to making any decisions regarding a Reverse Mortgage. We work very closely with the area's leading financial experts and would be happy to arrange a meeting. Simply click here to request an introduction.
As always, the consultations are free and tend to provide a wealth of insight into the possibilities that lay ahead.
If you would like more information as to how a Reverse Mortgage may benefit you in this market, please feel free to call me directly at (540) 904-0842 or email me at Josh@1st-Metropolitan.com. We look forward to helping.
Cheers!
Josh Perrington - Reverse Mortgage Specialist
1st Metropolitan Mortgage - Roanoke, VA
www.1st-Metropolitan.com | 540.904.0842 | 2762 Electric Rd, Roanoke, VA 24018
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