Articles about reverse mortgages have been popping up across all sorts of publications like the Wall Street Journal, New York Times, and now Kiplinger. Journalist Mary Beth Franklin covers the upcoming HECM changes in Reverse Mortgages Get Better.
The article starts off with basic information about HECMs but then describes a Denver area couple who recently used a reverse mortgage to finance about $60,000 worth of home improvements and to boost their monthly retirement income. “We can do some extra things now, such as travel,” says John, 75, who enjoys working in his home sculpture studio and cruising in his ’82 T-top Corvette. “We discussed it with our children and they said, ‘It’s your money — enjoy it,”says Phyllis, 72. Kind of sounds like the Robert Wagner commercial where he is standing next to the classic car right?
As baby-boomers move into their retirement years with fewer pensions, inadequate savings and increasing health-care costs, reverse mortgages are well positioned to serve as a financial solution, says Brian Montgomery, commissioner of the Federal Housing Administration. Peter Bell agrees.”We expect the growth of reverse mortgages to accelerate as seniors look for additional sources of income,” he says, “and because the new provisions of the Homeownership Act of 2008 broaden the market and make them more attractive.”
The article also describes a situation of how using the HECM purchase might make sense. Definitely worth the read.