In the past, the only opportunities for accessing some of the equity in your home were with a government insured Home Equity Conversion Mortgage (HECM) with a lending limit of $726,525. Some people saw value in using that reverse mortgage even with a high-value property of over $1,000,000, but there was nothing for the family with even higher-value homes.
The industry has evolved to meet the needs of high-value homeowners who would like better terms, no mortgage insurance upfront (saving $14,530) and no on-going mortgage insurance (0.5% of the loan balance annually).
Jumbo Reverse Mortgages are offered by private lenders and have the same non-recourse protections as the HECM (you will never owe more than the home is worth) without the mortgage insurance fees that some object to on the HECM product.
Even better, borrowers can access up to $4,000,000 in loan proceeds. Combine that with the ability to pay off your existing mortgage, and you have a game changer!
Some folks with high value properties are not really concerned about having money that will last through retirement, but would love to be free of a mortgage payment that may be $25,000 a month or more. It is really a “lifestyle” issue. Being free of the mortgage payment is liberating!
The loan proceeds are not taxable and may be used for any purpose such as paying off debt, purchasing a second home or investment property, travel, or to invest in other opportunities.
In addition, the strategic use of the funds from a jumbo reverse mortgage may be effectively
used to protect your portfolio be using the loan proceeds in your sequence of returns strategy.
This will allow your other investments to grow after they may have suffered a loss and need to have time to recover.
Using housing wealth as a tool to enhance your retirement and leave a legacy is a strategy that is being suggested by more and more financial planners. It just makes sense. You have paid into your home over the years just as you have paid into your 401(K) or IRA. There comes a time in retirement when you will access those assets to fund your lifestyle and longevity. Retirement models that include a reverse mortgage indicate the advantages of such a plan.
There are several options for Jumbo Reverse Mortgages, so speaking with a Reverse Mortgage Specialist at Silver Leaf Mortgage should be your first step. Depending on your goals and desires, you will be able to select the product that is right for you.
In the past, high-value homeowners had few options for accessing their housing wealth in the form of equity in their homes. A traditional HELOC was a choice, but as so many discovered in the 2007–2009 recession when HELOCS were called due, frozen, or eliminated, they are unreliable and require a monthly payment.
The jumbo reverse mortgage does not require a payment. The loan becomes due when the last borrower leaves the home permanently. You may sell at any time. No one owns the home but you, and the lender is not on the title.
A jumbo reverse mortgage is a non-recourse loan so your heirs do not inherit any debt. You may access up to $4,000,000 in loan proceeds meaning your home value may be far higher. To qualify you must be 62 years old or older, own the home, and it must be your primary residence. (You are allowed to own other homes.)
Counseling over the phone with an approved counseling agency assures that you fully understand the reverse mortgage product you have chosen. Jumbo reverse mortgages in Colorado are fixed-rate products with a variety of interest rates from which to choose based on your goals.
The money is taken as a lump sum at closing and will eliminate your current mortgage payment if you have one. Of course, you will continue to pay your property taxes and homeowners insurance, and maintain the home.
Call a Reverse Mortgage Specialist at Silver Leaf Mortgage, based in Denver, for details on the amount of housing wealth you will be able to access. Every scenario is different, so you will want information specific to your situation. Factors affecting the amount of your loan proceeds include the age of the youngest borrower, the value of the property and the interest rate.
Contact us at Silver Leaf Mortgage to speak to a Reverse Mortgage Specialist. We are experts who are A+ Rated by the Better Business Bureau and we are the #1 Reverse Mortgage Broker in Colorado by volume. We have the experience needed to help you with your jumbo reverse mortgage. We are happy to answer all your questions. Call us today!
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