L.A. Times on Reverse Mortgage Alternatives

The L.A. Times published an article this week covering some alternatives to taking out a reverse mortgage loan. The article, titled, “Elder homeowners might want to consider reverse mortgage alternatives,” offers options it calls alternatives to reverse mortgages including deferred payment loans (DPLs), property tax deferral (PTD) loans and Supplemental Security Income (SSI) benefits, and outlines several housing options.

The article doesn’t address pros and/or cons of reverse mortgages, instead it offers additional options.

“Reverse mortgages may very well be a good choice for some seniors who need to tap into equity they have in their homes,” the article states, before outlining the alternatives. “But there are other options elder owners might also want to consider.”


For DPLs, the L.A. Times writes, generally there are no origination fees and insurance premiums and closing costs are low, as are interest rates. As for a PTD loan, the article states, “Generally, it provides annual advances that can be used only to pay your property taxes or a portion thereof. But no repayment is required for as long as you live in the house.” They are only available in some areas, however. For SSI benefits, the article explains, seniors may be eligible if their liquid resources total less than $3,000 for a couple or $2,000 for an individual.

For those who don’t qualify for a reverse mortgage or for whom reverse mortgages proceeds are not sufficient, the article suggests three housing alternatives: accessory apartments, ECHO cottages and sharing arrangements.

Read the L.A. Times article.

Written by Elizabeth Ecker

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  • “If you qualify for Supplemental Security Income, you might automatically qualify for other public benefits that may allow you to postpone the need for a reverse mortgage. That way, if you do take out a reverse loan later, you may be able to receive larger advances because you will be older and the value of your house may have increased.”

    No mention of interest rate? What happens if interest rates go up? Even if values increase and the senior ages the amount of funds could be less.

  • I always try to find alternative programs, for my senior prospects, offered by the state and/or feds. This is a great way to build trust and develop rapport. A very informative article.

  • I agree that the article is well written and balanced. Having dealt with the CA state run program for PTDs as well as some local loans to homeowners to refurbish their homes, I find that the programs are great and I never suggest that a homeowner get a reverse mortgage that would damage the PTDs, the DPLs, or SSI which the homeowner has in place. Several issues I have brought up in the past are: how current is the program info the BCU provides — as we know, CA has funding problems and I doubt other states are too far behind and I wonder how long the state will fund deferred property taxes that local governments need in order to operate; how many local governments do you know that are extending DPLS at this time; and while taking SSI is a temporary fix, doesn’t it lower what the senior receives of Soc Sec benefits in the long run?

    I am not asking questions I know the answer to. Is there anyone who does and could shed light on the subject?

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