A Well-Planned Future in Reverse
MAY 07, 2019 BY CARMEN ALTAMIRANO, HECM MARKETING MANAGER – HECM EDUCATION IN PRODUCT, EDUCATION
There’s a generation among us living on a financial silent edge – those so monetarily strapped, that most months are spent in the dreadful negative. Our cherished old-timers. The ones who’d proudly reminisce the era from which they’ve arrived. The rightful boasters to a better time. “Back then,” they’d say, “hard work earned you the American Dream, a person’s word was as good as gold, handshakes and eye-contact were of the utmost value, and people prioritized time to oblige those societal jewels now considered today’s rarities.”
A ‘hipper’ group is being introduced daily to the elderly ranks—those we’ve coined the Baby Boomers. They bring to the table, a course of setbacks that have drastically impacted their latter years’ financial security. There was a time when retirement planning was a corner stone given for Boomers and their parents, but today’s story is vastly different. There’s no longer a simple question of comfort and security—a more serious matter of survival question has posed itself by what’s become the underprepared norm.
An Insured Retirement Institute Study recently reported the Baby Boomer generation as working longer to offset insufficient retirement savings.
To put it in perspective:
- 24% have NO Savings
- 55% have SOME Savings
- 42% have LESS Than $100,000
It’s rather clear: our beloved Boomers are in desperate need of a plan B.
DID YOU KNOW?
10,000 Baby Boomers reach age 65 in the U.S. DAILY. The post WWII generation committed a better part of their working years, saving sacrificially to establish a well-planned nest egg. Yet sadly, so many are still facing serious financial hardship.
In a ‘thief in the night’ sort of fashion, last decade’s economic decline came and swooped away from the hopefuls, a peaceful and enjoyable retirement. But what folks may not realize is that despite the hit, their home’s equity may potentially hold a supplemental key toward restoration. Hiding in plain sight is a wealth source available to seniors—if they only knew.
The Reverse Mortgage Market Index (RMMI) released data that’s upheld the HECM claim and its proposed solution. In 2018’s fourth quarter, it was revealed that 23.9 million senior-aged homeowners hold a whopping $7 trillion in tap-worthy access to home equity wealth.
There are dated misconceptions still looming among us that subliminally contribute to borrower hesitation. And although recent program changes have assured a safeguarded FHA Insured and Guaranteed Reverse Mortgage via the ‘HECM,’ skeptics remain. What the HECM presents is a viable ‘golden years’ option—an aging comfortably in place kind of option. Nonetheless, there remains a large percentage of qualifiable seniors unaware of the program and its advantages. In fact, scores of Real Estate Agents and LOs alike sit silent members of the same ‘uniformed club.’
It’s true that Reverse and its associated products afford borrowers a life-changing benefit. And although many have taken rightful advantage of the program, there’s a significant many situated in the dark; meanwhile, their financial well-being hangs in the proverbial balance.
You might be wondering …
What exactly are Reverse and Home Equity Conversion Mortgages (HECM)?
A Reverse Mortgage allows a Senior Borrower, aged 62 Years or Older, a Mortgage option with ‘Payment Free’ access to an untapped portion of their home’s equity. Loan contingency requirements include up-to-date property taxes and insurance payments as well as property upkeep and maintenance.
The Home Equity Conversion Mortgage program, also known as HECM, is the Federal Housing Administration’s spin on the original Reverse Mortgage Program. Built-in to the loan is a non-recourse structure that places an owner never owing more than their property is worth. Additional protections also assure that rightful property ownership interest remains with the owners and their heirs.
Have you considered partnering with us?
The HECM provides a unique service, yet protective umbrella to its borrower.
With a safety-aligned mindfulness, a HECM specific Certification Course has been made available to ALL PRMG Branch LOs, nationwide. To originate Reverses/ HECM’s as opposed to simply referring them in, certification is your answer. The course is found in PRMG’s Learning Management System (LMS), and as PRMG’s Branch Managers and LOs, you’ll be pleased to find the course already assigned to you.
So why you?
Well, you’re already delivering within reach, your clients’ real estate goals and aspirations—why not take it a step further?
For some candidates, Reverse Mortgage can most certainly serve as a great final curtain to a lifetime of wise investments—a great financial planning tool. But what the record majority reflects now is more of an ultimate saving grace.
Simply said, as one person has once wisely put it, “The greatest good you can do for another is not just to share your riches but to reveal to him his own”— Benjamin Disraeli.
To learn more about Reverse, please reach out to HECM411@PRMG.NET–we’d love to partner with you!