Photo by Andrea Piacquadio from Pexels
" Loved ones , especially during the virus , are looking for a way to keep their elders in the safety of their own home and receiving the quality and quantity of care they needed ." part time jobs and need to make ends meet , helping family affected by Covid , and those who are just generally concerned about their future finances . NRMLA states there has been a 55 % increase in the number of draws and 14 % in the size of the draws . In fact , they notice that some borrowers who had never previously drawn on their line of credit are fully drawing the line now .
As Covid gets more impactful on the economy and on peoples ’ lives in general , we should expect reverse mortgages to grow , and now seems to be the most opportune time to obtain one – before interest rates increase .
Most major banks have seriously curtailed the issuance of HELOCs during the current Covid crisis , and those that continue to offer HELOC ’ s have imposed stringent qualifications to borrowers .
Many borrowers are realizing reverse mortgages offer advantages over HELOCs in this regard . There are limited income and credit qualifications to obtain a reverse mortgage . Reverse mortgage ( HECM ) lines of credit cannot be frozen or reduced , and , since there are no monthly mortgage payments , the risk of foreclosure [ even after the moratorium ] is slim .
A new situation has arisen due to Covid and that has to do with nursing homes . Once considered an alternative to inhome care [ which is usually two to three times the cost of a nursing home ], many stories have been published about the increase in deaths surrounding Covid and older Americans in care
facilities . Most people would like to be in their own home instead of a care facility given the choice , but , unfortunately , many people cannot afford the [ around the clock ] care required to stay home and be cared for . Loved ones , especially during the virus , are looking for a way to keep their elders in the safety of their own home and receiving the quality and quantity of care they needed . Many are looking toward a reverse mortgage to fill this need . Many people have enough equity in their homes , especially as real estate has tremendously rebounded since The Great Recession , to allow them a large enough reverse mortgage to afford the costs associated with inhome care .
The National Reverse Mortgage Lenders Association [ NRMLA ] reports that there have been significant increases in draws [ on the HECM reverse mortgage line of credit ]. Those retirees who lost their
EDWARD BROWN
Edward Brown currently hosts two radio shows , The Best of Investing and Sports Econ 101 . He is also in the Investor Relations department for Pacific Private Money , a private real estate lending company . Edward has published many articles in various financial magazines as well as been an expert on CNN , in addition to appearing as an expert witness and consultant in cases involving investments and analysis of financial statements and tax returns .
Edward Brown , Host The Best of Investing on KDOW AM1220 on Saturdays at noon 21 Pepper Way San Rafael , CA 94901
ebrown1111 @ aol . com
67