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November 2016

Issue 47




email Nancy 


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Nancy is co-Founder of
The Boxwood Alliance
for Active Aging



Nancy Gould, Past President Estate Planning Council of Putnam County
                    Dream Come True

Often times it is difficult to qualify for a mortgage. This is especially true for folks who are near the end of their working careers or have retired.  However, there is another option for people who are 62 years or older. The option is a reversed mortgage.

Natalie and Saul married in their 50's, both second marriages.  They moved to Flushing and purchased a very popular style red brick house. They became a part of the community and were happy
After Saul had a serious fall, which affected his mobility, Natalie began to think of finding a smaller home that did not have stairs and would be easier for her to maintain.  Saul agreed.  After all, they were now in their mid 80's and it would be the time to move if they ever were to do it.

Natalie found a few apartments in New Jersey near their friends. How would they finance an apartment without first selling their home in Flushing?  Saul began researching their options and learned about reversed mortgages.

A reversed mortgage would lend between 50%-70% of the property value.  The maximum property value used for calculation is capped at $625,500.  They would be able to use the equity in their Flushing home to purchase a condo and not have any monthly payments. The interest on the mortgage is simply added to the balance.  The would pay back the loan after they sold their Flushing residence.

Saul knew this idea would please Natalie.  If Natalie was happy, Saul was happy.

The basic rules of a reverse mortgage are: 1. The main borrower must be 62 years or older, 2. The borrower(s) lives in the property as primary residence, 3. The borrowers pay the ongoing property taxes and home owners insurance and maintain the home
The borrowed money accrues interest for the amount of time it is borrowed.  The borrower may have the option to pay down the balance, but no repayments are required until the borrower(s) permanently vacates the home.  The full balance comes due when the borrower sells the property, moves out or passes away.  The property's appreciation over time helps to defray the interest that is accumulating.

Reverse mortgages are HUD-regulated and FHA-insured.  The program was created to help seniors convert the equity in their homes to cash to leverage their residence as a financial resource. 

Natalie and Saul set up a reversed mortgage credit line and began apartment shopping.  Now they could be serious and put money on one that is pleasing to them.

Please Note:This information was provided by Alice Tseng, an expert in reverse mortgages.  She has helped many realize their dreams.
For additional information or full consultation please contact Alice Tseng, Licensed Loan Officer NMLS#974322 at 646 543 9262

May you have a most Happy Thanksgiving!


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