By Alain Valles, CRMP, CSA, MS, MBA
Nonprofit Charitable Managing Director
Stock market uncertainty and rising interest rates
Ouch! Stock market gains can be wiped out in a day, the Federal Reserve continues to increase interest rates, the US-China trade war is impacting companies, and even Apple has warned of a downturn. And then there’s the government. Hopefully it’s reopened by the time this article goes to print.
This can all be disquieting, stomach churning, and even frightening, to see your financial future batted around, with no guarantee your money is safe.
If you are seeking a more secure and stable source of cash flow, you may be sitting in it right now – your home. The equity you have built up by making mortgage payments over the years has real value. That equity could be a reliable source of tax-free immediate cash or give you peace of mind of being able to access funds in the future if needed.
As Managing Director of the self-funded nonprofit charitable mortgage company, Helping Hands Community Partners, our mission is to educate people about housing options. But it’s almost impossible to make housing decisions without considering other economic variables. We do not give financial advice but instead focus on how one may use their home to augment one’s retirement plans including creating a financial safety cushion.
One option to explore is the federally insured Home Equity Conversion Mortgage which is also known as a Reverse Mortgage. We believe a reverse mortgage – when used properly – is a sound option. However, we are concerned that some borrowers don’t fully understand the risks, expenses, and ongoing obligations of a reverse mortgage. We strive to educate people about different housing choices and focus on sharing the facts about reverse mortgages.
Reverse mortgages have been the solution to:
- Additional monthly cash flow
- Pay off existing mortgage, credit cards, or other debts
- Ability to pay real estate taxes
- Cover medical expenses and at-home assistance
- Complete home improvements and renovations
- Monthly check to you for life
- A line of credit that grows over time
- May close in a trust or life estate
- Peace of mind knowing funds are available if ever needed
- And, most importantly, a buffer or offset to the volatile to get off the stock market roller coaster.
Please note – payment of real estate taxes, insurance, and abiding to other guidelines are always required.
A bit of good news
As of Jan. 1, the Federal Housing Administration (FHA) increased the lending limit to $726,525 for higher valued homes. For qualified seniors, this resulted in an increase of approximately 6.89 percent. Exact figures depend on your age, home value, and financial assessment. Please contact us for more detailed information.
Receive free factual information
Please contact us with your questions and to receive your free copy of “Use Your Home to Stay at Home.” We are available to explain Reverse Mortgage details by phone or we are happy to visit with you at your home. At no time will you ever feel any pressure to move forward. For us, it’s all about educating people on homeownership options and living a good life. For detailed scenarios, all we ask is your age, estimated property value, current mortgage balance if any, and a few financial assessment questions.
Alain Valles is Managing Director of Helping Hands Community Partners, Inc. and was the first designated Certified Reverse Mortgage Professional in New England. He obtained a Master of Science from the M.I.T. Center for Real Estate, an MBA from the Wharton School, and graduated summa cum laude from UMass Amherst. Alain can be reached directly at 781-724-6221 or by email at [email protected].