5 Reasons Why Seniors Get Reverse Mortgages

If you're nearing the age of retirement, usually 62 years old, and you have equity built up in your home, you may have looked into doing a reverse mortgage. You should do your homework and really research what a reverse mortgage is all about and how it may or may not benefit you to have one before making any final decisions. Here are the top five reasons that seniors obtain a reverse mortgage. Do you see your self in any of these scenarios?

1. Retirement Lifestyle

Homeowners that have lived in their home for the last thirty years or so have either paid off their mortgage completely or have been making monthly payments that is bringing them to the end of their mortgage journey. Depending on how much your mortgage is or was, this may be the biggest expense you pay out on a monthly basis. As you reach retirement, you may be starting to worry about how your fixed income will weather in continuing to cover all of your fixed monthly living expenses such as housing, medical and insurance. Even if you have income from retirement accounts, pension plans, social security or other sources, a reverse mortgage can allow a retiree to increase their fixed income amount. In essence, the added income a reverse mortgage provides can establish a higher quality of life--a nicer retirement lifestyle--than if they didn't have the reverse mortgage payment coming in every month.

2. Pays for medical expenses

Medical expenses are a fact of life, but this fact seems to increase as you get older. And since the cost of health care isn't getting any cheaper, rising costs make it harder for seniors to pay for health care on a fixed income. It forces some to have to choose between buying food and paying for their medication on a regular basis. With a reverse mortgage adding to monthly income, it can help you to cover all of your expenses and not have to choose between medicine and some other necessity.

3. Changes to home

As you age, your living accommodations have to change as well. For example, it's harder for you to get up and down the stairs, so if you have a two-story home it may be time to modify your existing home or move to a more accommodating home for your aging needs. Reverse mortgage payments can help to cover moving or renovation expenses to make your home more comfortable for your next thirty years of life.

4. Gives you spending money

Probably one of the top things that retirees look forward to when they retire is the ability to travel more. Reverse mortgage payments have been known to provide retirees with extra spending money to cover the necessities in life and to splurge a little along the way on items such as vacations.

5. Pay off or pay down debt

Just because you retire doesn't mean that your debts simply disappear. Reverse mortgage payments may be the extra cash you need to finally pay off, or at least pay down your outstanding debts. Once your debt is paid off, the reverse mortgage money that keeps rolling in means you'll have even more money each month to apply toward other expenses and purchases.

If you are nearing retirement and you have equity built up in your home, you may want to consider what a reverse mortgage can do for you. Be sure to research what a reverse mortgage is all about and how it may or may not benefit you before making a final decision. It may be just what you need to live out your retirement years in style.