What is an over 60’s Seniors Reverse Mortgage?

What the hell is a reverse mortgage? Sounds bizarre. Well, it’s exactly that. Instead of making repayments every month and your mortgage going down, you don’t make any repayments and the mortgage goes up. I know that sounds nasty, but these reverse mortgages or seniors’ loans have been designed for seniors obviously.

You need to be minimum 60 years of age to qualify and the older you get, the more I suppose equity you can pull out of your home or investment property. So, these are designed if you’re you know cash flow poor but asset rich. There’s a lot of people out there that are struggling to live on on the pension and enjoy their retirement and hey you’ve worked hard all your life, you’ve paid your home off, you should be having fun in your retirement. Now these are very close to home because I actually put my parents in one of these many years ago and it changed their lives, and they were able to actually enjoy their retirement years, and not have the stress that goes along with not having enough money to pay your bills.

So why would you get a reverse mortgage? Okay, so you may have a home worth a million dollars but you’re on the pension and you’re struggling. You’ve got rates, you’ve got maintenance and repairs to do the home, you haven’t got enough money to buy a new car or repair the one you’ve got, you want to go on holiday enjoy your time, but you can’t afford to do that. So, having a reverse mortgage is basically about releasing equity on your home, it’s like a line of credit that you can draw down upon and that money doesn’t have to be repaid at all.

You can make repayments, your children can make repayments to reduce the capitalising interest over time if they wanted to, I suppose, preserve their inheritance. But the thing doesn’t need to be paid off until the property’s sold or both of the owners pass away. So what happens, the interest capitalises, you spend, you enjoy yourself and no worries and no stress.

If this is something that you think could benefit yourselves or a family member, please reach out and we’ll assess their position and see if we can help – contact us on 07 5532 0030.