Given that we now have longer life expectancies, higher costs of living and the recent property boom, many retirees are discovering themselves to be asset-rich and cash-poor.
Retirees and people over 60 years of age today have a few options moving forward.
The first option is to downsize
This has disadvantages as there are costs associated with selling the house, purchasing a new home and other expenses. An estimate of the cost would be close to $100,000, which may incur a huge loss of your capital unless the move is a necessity.
As a result many retirees take the view that they are better off battling on with their present house with the ongoing bills and maintenance costs that come with it.
The second option is to seek a Reverse Mortgage
Most major banks have opted out of this lending product largely due to changes in their lending policies and in view of the negative
publicity that many have received from the recent Royal Commission. There are only a few financial institutions that are continuing to provide similar financial solutions for retirees.
Taking out a reverse mortgage involves making significant and crucial decisions. However, once these decisions have been carefully considered and all the pros and cons weighed up, reverse mortgage can be a very viable option for retirees. Some lender products allow for lump sums or periodic payments, to assist with daily living costs.
Although the process seems foreboding, it may well be worth the trouble if it can release you from excessive financial burden and stress, and provide you with a clear and liberating path forward for the rest of your life.
Paul is accredited with experienced Reverse Mortgage lenders who offer a variety of options to suit the borrower’s situation and requirements. Contact Paul today.
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