Using Home Equity
Wisely in Retirement

For most homeowners heading into retirement or in retirement, your home will be one of the largest assets you have. Using your home equity wisely as part of your retirement plan can help you meet your monthly cash flow needs, protect and stretch your retirement assets, and help you achieve your retirement goals.

Home Equity Conversion Mortgages,
a Retirement Tool for Many

A home equity conversion mortgage allows homeowners 62 and older to convert home equity into cash, a line of credit, or monthly payments while retaining home ownership. No monthly mortgage payments are required and you can live in the house as long as you would like as long as you follow program guidelines.

There are no limitations to how you use the money, so you can free up cash to cover medical expenses, plan for your retirement, or improve your monthly cash flow.

Lifestyle Benefits

Eliminate monthly mortgage payments

Fund necessary home renovations

Improve monthly cash flow

Any remaining equity once the loan is paid off goes to you or your heirs

Continue to live in your home

Qualifications

62 years of age or older

Property must be a primary residence

Often requires significant Home Equity

Property taxes and homeowner’s insurance must remain current

Must meet the financial assessment requirements

*Qualification may depend on attributes such as age, loan amount limits, and home equity
*To learn more about this government loan program via HUD’s, please visit: HECM Program Information

Reverse Resources

BLOG

Secure Your Retirement: How Does a Reverse Mortgage Work?

Learn how reverse mortgages work, understand the ins and outs of reverse mortgages, and take the first step toward financial security.

Your Comprehensive Reverse Mortgage Handbook

This guide walks you through every step of the reverse mortgage process, from eligibility and application to approval and receiving funds.

Download Booklet

VIDEO

Reverse Mortgage FAQ: Answering Your Questions on Reverse Mortgages

Welcome to my Reverse Mortgage FAQ video! I hope this can help answer any questions or concerns you may have about the reverse process.

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Reverse FAQ

What is a reverse mortgage?

A reverse mortgage is a special loan program created specifically for senior homeowners that allows them to tap into their home equity and continue to reside in their home and defer any payments on the loan.

How is the reverse mortgage loan amount determined?

There are three pieces of information needed to determine how much money is available: the borrower’s age, current interest rates, and the home value.

What are some common misconceptions?

The most common misconception is that the lender will own your home when you obtain a reverse mortgage and that you will lose any equity you have, which isn’t true. Read about more misconceptions here.

What does it mean that a reverse mortgage is a non-recourse loan?

The non-recourse feature is a powerful aspect and states that the homeowner is not responsible if the loan balance grows beyond the home’s value.

Does the required mortgage insurance benefit me?

The mortgage insurance pays for the non-recourse feature, so that you can never own more than what the home is worth, allows the homeowner to live in the home as long as they want, allows borrowers to have more money to draw in the future, and guarantees that the line of credit can never be frozen or have a balloon payment.

What are the eligibility requirements for a reverse mortgage?

The four following requirements remain somewhat standard for reverse mortgages:

1. Age. With the HECM product, the youngest borrower must be at least 62 years old, however, non-borrowing spouses may be younger than the required age.

2. Homeownership. To qualify for the reverse mortgage, the borrower will become the new homeowner on the new property and will need to occupy it within 60 days.

3. Residency. The home must be the homeowner’s principal residence. This program is not available for second homes or investment properties.

4. Property Type. The accepted list of eligible property types include single-family residences, two-to-four unit properties, when the borrower occupies one unit, townhomes, planned unit developments, modular homes, manufactured homes, and condos.

What are my options for accessing the equity?

The fixed-rate HECM is a closed-end loan and only offers a one-time single dispersement of all the funds available to you, but the adjustable-rate HECM has various payout options.

What is the line of credit growth rate?

The line of credit option on a reverse mortgage is guaranteed to grow at the same rate as the interest rate and FHA mortgage insurance premium, which is charged on any outstanding loan balance. This not a rate of return on your line of credit like an investment, but a growth in the amount of money you can borrow in the future against your home value.

Can I make a payment on my reverse mortgage?

Yes, you can make payments on your reverse mortgage if you choose, even though they are not required. You can pay partial interest, all the interest, or some principle and interest every month.

What is the difference between a home equity line of credit or HELOC and a reverse mortgage line of credit?

A traditional home equity line of credit or HELOC allows the homeowner to access a set amount of equity from their home. HELOCs require the homeowner to make monthly payments based on the current rates and how much they draw out.

Reverse mortgage lines of credit require no monthly payments and are easier to qualify for those 62 and older. The draw period never ends and the line of credit can never be frozen.

How can a reverse mortgage help me get more money from Social Security?

Many times, seniors decide to take Social Security early so that they can start to receive the monthly income to help with monthly expenses in retirement. By taking it earlier, though, it reduces how much they will get per month for the rest of their life. Instead of taking your Social Security early, use a reverse mortgage to supplement your income and wait until age 70 to take Social Security. This will allow you to lock in the maximum amount of Social Security available to you.

How is the reverse mortgage paid back after the last borrower passes away?

There are three options available to the heirs:

1. Repay the loan. The heirs can repay the loan by refinance or some other means and keep the house. They also do not have to pay more than 95% of the appraised value of the property.

2. Sell the property. The heirs can sell the property, repay the loan balance, and keep the remaining equity.

3. Deed the home. By transferring the deed to the heir, they can walk away if the loan value exceeds the home value.

When is a reverse mortgage not a good option?

A few reasons why a reverse mortgage may not be the best fit are if the homeowner intends to sell the home soon, if the home does not meet their long-term physical needs, if the reverse mortgage offers little current or future advantage, or if there is an adult child still living with the senior homeowner.

What are the benefits of using a reverse mortgage to purchase a home?

Using a reverse mortgage to purchase a home allows those over 62 to right-size into the home they need for retirement, but be able to do that without putting all the proceeds from their previous sale into the new purchase. This can allow the homebuyer to keep money liquid for home improvement, medical needs, or other retirement needs.

Reverse Client Testimonials

How a Reverse Mortgage Can Provide Monthly Income

★★★★★

“It’s the only way to go, you don’t have to worry about stuff like I used to… I could go into my savings and buy something which I had been afraid to do before I got the reverse mortgage.”

Grace H.

Freedom from Mortgage Payments with a Reverse Mortgage

★★★★★

“This reverse mortgage obviously helps out because it’s nice not to find a mortgage bill every month. Frankly, we wouldn’t still be in this house if we hadn’t gotten a reverse mortgage.”

Jim & Mary H.

Using a Reverse Mortgage Helped Me With a New Purchase

★★★★★

“I chose a reverse mortgage because it almost doubled the price I could pay for a new home in a beach community. I’ve really gained a lot with a reverse mortgage.”

Gary R.

★★★★★

If you’ve been thinking about a reverse mortgage but don’t know if it’s right for you or think it’s risky you need to talk with Shanne Sleder at RWM. Shane is extremely knowledgeable, friendly and takes the time to answer all your questions. He works hard to get you the best deal for your situation. We just finished our reverse mortgage with Shane, it went so smoothly, easiest transaction we have ever done. He and his team stays on top of your transaction eliminating those ugly surprises that sometimes happen with other lenders.

Joel S.

Team Sleder at RWM really came through for me with my reverse mortgage line of credit. I had a few extra hills to climb due to special circumstances on my end. They all handled it with grace, compassion, and expertise. I am beyond grateful for having them on my team. Thank you, Team Sleder!

Randie H.

I would like to recommend Shanne to anyone – he worked with us on an unusual reverse mortgage, during which we went on a 3-week vacation, and he coordinated everything perfectly. Much appreciated!

Eileen G.

Shanne Sleder and his support crew at RWM Home Loans were exceptionally diligent, methodic and supportive throughout the very complicated process of my Reverse Mortgage Purchase Loan for our new home in La Mesa, CA. Especially so, were the empathic support and personal attention to the timely prevision required by FHA for our particular situation, by the Loan Processor Laura Martinez. Thank you all!

Ted V.

Shanne is very nice to work with. No pressure. Shanne helped me with my reverse mortgage and helped me understand everything. I wanted my daughters to be here so he made a extra effort to make the time work for their schedule also. He is a very honest man. I would definitely recommended him. He is very willing to help.

Grace H.

We had the pleasure of working with Shanne Sleder and his team for the recent purchase of our home in FL. Even though Shanne is based in CA he is licensed in many states and he and his team worked diligently with us, guiding us through the processes and made our closing deadline. I would highly recommend Shanne and his team if you are looking for knowledgeable people who go the extra mile to assist you

Denise L.

Hi! I’m Shanne Sleder

Mortgage Advisor, CRMP

NMLS# 239958

Serving AZ, CA, FL, ID, NV, OR, TN, TX & WA

Shanne specializes in making the loan process easy to understand and fully transparent. He has developed a 3 step process to make sure his client’s loans close on time and they are satisfied. A specialist in Reverse Mortgages, his process not only starts with an in depth consultation, but he makes sure your mortgage needs are taken care of well into the future. Shanne works with many first time home buyers, move-up clients, and seniors.

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Shanne is a CRMP

Certified Reverse Mortgage Professional

As a CRMP, he is a mortgage professional who commits himself to leveraging his experience and knowledge to serve older homeowners. Equipped with up-to-date education and a high level of connectivity with other top reverse industry professionals, Shanne is ready to provide you with quality information and options that are appropriate for your goals and your current situation.

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Ready to Secure Your Retirement?

Apply Now

Using Home EquityWisely in Retirement

Home Equity Conversion Mortgages,a Retirement Tool for Many

Lifestyle Benefits

Qualifications

Reverse Resources

BLOG

Secure Your Retirement: How Does a Reverse Mortgage Work?

BOOKLET

Your Comprehensive Reverse Mortgage Handbook

VIDEO

Reverse Mortgage FAQ: Answering Your Questions on Reverse Mortgages

Reverse FAQ

Reverse Client Testimonials

How a Reverse Mortgage Can Provide Monthly Income

Freedom from Mortgage Payments with a Reverse Mortgage

Using a Reverse Mortgage Helped Me With a New Purchase

Hi! I’m Shanne Sleder

Mortgage Advisor, CRMP

Shanne is a CRMP

Certified Reverse Mortgage Professional

Ready to Secure Your Retirement?

Using Home Equity
Wisely in Retirement

Home Equity Conversion Mortgages,
a Retirement Tool for Many