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Reverse Mortgage in Fort Collins CO

Reverse Mortgage in Fort Collins CO

The scenario for a Colorado Reverse Mortgage in Fort Collins CO…

Mace,

My wife is 65 and I am 60. I was laid off and am finding it difficult to find employment. We’ve got some savings but don’t want to totally deplete it over the next few years.  I’ve not given up looking and may take a different path than what I’ve done over the past 35 years. If nothing else, it will allow me to stretch our nest egg out further.  Our home is worth about $400,000 and we have an outstanding mortgage balance of $125,000. We owe less than $10,000 in other debts. I know that I don’t qualify for a Reverse Mortgage because I’m not 62 years old, but we were wondering if you had any suggestions. Thanks in advance! -Phil W.

Colorado Reverse Mortgage owner Mace Kochenderfer’s reply…

Phil, Thank you for sharing your concerns and questions with me.  Your situation allowed me to expand a bit and I hope others found it interesting. My intent was to give you more insight as to what options you have at this point.

I’ll continue…

Phil has a solid equity position in his home and a Colorado Reverse Mortgage would provide enough benefit to pay off his current mortgage and other outstanding debts. This is an interesting scenario that has a few answers because Phil is not yet 62.  Only Phil and his wife can determine what is best for them at this time. Sometimes folks don’t like my solutions, but I’m not here to sugarcoat my answers.

The way I see it, Phil and his wife have 4 options.

First Option:

This may not be an option you like Phil, but it IS an option. Feel free to embrace or ignore it… It’s easy! Sell your home, pay off your debts and buy a less expensive house in perhaps a different neighborhood.

This may not be an attractive option for you but it may be the proper solution for someone else watching this video. I won’t say it’ll be easy or fun, but sometimes it is clearly the most appropriate but not always obvious solution.

Selling your family home, buying a new one, the expenses involved with both, along with the time, emotion and stresses are beyond my focus. I’m not a real estate broker or family therapist so I don’t have much more input to share… With that, let’s move on to Option Two…

Second Option:

Phil, since you’re not yet 62, you do not qualify for an FHA Reverse Mortgage. The FHA Reverse Mortgage is also known as a Home Equity Reverse Mortgage or simply a “HECM” (pronounced: heck-um). So, Option 2 is to simply do nothing but hang tough for the time being. Go get that new job or deplete your nest egg for the time being. It won’t be fun, but sometimes you do what you’ve got to do. I can’t solve your problem today, but maybe I can solve it tomorrow.

A month or two prior to your 62nd birthday, you and your wife can contact Colorado Reverse Mortgage to begin the application process.  During this period, together we’ll get the ducks in a row.  You can get the Counseling Certificate, Title, appraisals, inspections and other paperwork will be completed, submitted to and reviewed by the Underwriters. Then on the date of your 62nd birthday, you’ll be able to close your HECM Reverse Mortgage.  Paid off will be your current mortgage and other debt obligations. Happy Birthday, Phil!

Third Option:

I have no opinion as to whether this option is appropriate or not. Perhaps you married your high school sweetheart and have been married for 40 years. Then again, maybe you married 3-months ago in a spur of the moment wild weekend in Las Vegas! Regardless and for the sake of this conversation, I’ll assume you both are fully committed to each other ‘till death you part.

Your wife is 65 and is old enough to qualify for a Reverse Mortgage on her own. Phil, you could remove yourself from the title and allow her to complete the Reverse Mortgage in Fort Collins CO on her own. By doing this, you’d stop the monthly outflow over the next approximately 18 months (or however many months before you turn 62). If your current mortgage Principal and Interest payment is $1,000 and your credit card minimum payments are $150, then over an assumed 18-month period, you’d have an extra $20,700 in your back pockets and no credit card debt!

A few years ago, I would have advised you to NOT consider this option. There used to be a valid concern about what would happen if your wife died before you. Required only a few years ago, was that you’d have to pay off the Reverse Mortgage in Fort Collins CO! However, in 2014 FHA implemented some protective measures that protected the Non-Borrowing Spouse (or NBS) by deferring repayment of the mortgage until their death. This means that you may continue to live in the home without needing to make any repayment for the rest of your life.

On my website, under the FAQ’s I have more details about how this works.

Option Four:

This option allows you to remain on Title to the home because the youngest homeowner must be at least 60 (not 62) years old.

Don’t do a HECM Reverse Mortgage, but rather let’s consider a NON-HECM Reverse Mortgage. Sometimes this Proprietary Reverse Mortgage is called a Jumbo Reverse Mortgage. Don’t let the term “Jumbo” mislead you; any home size or value works. Not guaranteed by the FHA regardless of what we call it, it largely works like the more common HECM. By following the link, there’s more information and a great educational video.

Of course, there are both plusses and minuses when choosing this option. But for now, I can’t help you determine whether this option is appropriate without us having a deeper fact-finding conversation.

Colorado Reverse Mortgage

We are more than just a Reverse Mortgage company and feel it’s important to look at and address a bigger picture. We discuss Reverse Mortgages (of course) but will be happy to share our knowledge and input on a variety of “senior-centric” topics. Mace visits about the importance of Retirement Planning, Estates and Trusts, Social Security, Home Safety, Power of Attorney documents, Senior Abuse (financial, physical and mental), and many other areas. Remember, we’re not just a reverse mortgage company, we’re your neighbors.

Check out our Reviews here! 

Use this Reverse Mortgage calculator. This is a safe site and the calculator will give you a rough estimate. However, there are better ways than this calculator that will provide more accurate numbers. An experienced Certified Reverse Mortgage Professional will also know ways to maximize the financial benefits to a consumer.