The Unconventional Ideal Reverse Mortgage Candidate: Insights from Understanding Reverse by Dan Hultquist

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This post is a summary of the following podcast: Redefining the Ideal Reverse Mortgage Candidate: Insights from ‘Understanding Reverse’ by Dan Hultquist

Reverse mortgages are often misunderstood and surrounded by myths. Many people think they are only for those who are cash-strapped or desperate, but this couldn’t be further from the truth. In his book Understanding Reverse, Dan Hultquist sheds light on an unconventional idea of an ideal reverse mortgage candidate. This blog post will explore these insights and explain why someone who is 62 years old, still working, has 5-10 years left on their mortgage, and may not need the funds immediately could be a perfect fit.

What You’ll Learn:

1. Debunking Common Myths

2. Who is the Ideal Candidate?

3. Financial Planning with a Reverse Mortgage

4. A Real-Life Scenario

Debunking Common Myths

Reverse mortgages often come with a cloud of misconceptions that deter many from considering them as viable financial tools. However, Bruce Simmons and Dan Hultquist aim to clear the air by addressing these myths head-on in their discussions and writings. Let’s delve deeper into two prevalent myths and uncover the reality behind them.

Myth 1: Reverse Mortgages Are Only for Desperate People

Reality: They can be strategic financial tools used to enhance retirement plans.

One of the most pervasive myths is that reverse mortgages are a last resort for those in dire financial straits. This couldn’t be further from the truth. While it’s true that reverse mortgages can provide much-needed relief for those facing financial difficulties, they are also powerful instruments for proactive financial planning.

Consider this scenario: A homeowner at age 62 who is still working might not need immediate access to additional funds but could use a reverse mortgage to establish a line of credit. This line of credit grows over time due to compounding interest rates, providing a safety net for future needs or unexpected expenses. By setting up this resource early, homeowners can ensure they have flexible options available without having to liquidate other investments or assets prematurely.

Moreover, using a reverse mortgage strategically allows retirees to manage their cash flow more effectively, supplementing their income during market downturns or periods when other sources of retirement income may be less reliable. It’s about creating an additional layer of security and flexibility rather than acting out of desperation.

Myth 2: You Must Be Cash-Strapped to Qualify

Reality: Even financially stable individuals can benefit from a reverse mortgage under certain conditions.

Another common misconception is that only those who are cash-strapped qualify for reverse mortgages. In reality, even financially stable individuals with substantial assets can find value in incorporating a reverse mortgage into their overall retirement strategy.

For instance, someone who has diligently saved and invested throughout their career might still opt for a reverse mortgage as part of their diversified approach to managing wealth in retirement. By tapping into home equity through a reverse mortgage, they preserve other investment accounts’ growth potential while ensuring liquidity when needed.

Additionally, financially stable individuals might use funds from a reverse mortgage to pay off existing high-interest debt or invest in home improvements that increase property value and enhance quality of life during retirement years. The key here is leveraging home equity smartly rather than waiting until all other resources are exhausted.

In essence, qualifying for—and benefiting from—a reverse mortgage isn’t limited by one’s current financial status but rather how well it fits within broader long-term goals and plans tailored specifically towards enhancing overall stability during later stages in life.

By debunking these myths surrounding reverse mortgages through real-life examples like those discussed above by Bruce Simmons & Dan Hultquist’s book Understanding Reverse, we hope you gain clearer insights into why considering such options sooner rather than later could prove beneficial regardless if you’re currently experiencing any immediate monetary constraints or not!


Who is the Ideal Candidate?

According to Understanding Reverse by Dan Hultquist, the ideal candidate for a reverse mortgage might surprise you. The profile of an ideal candidate defies conventional wisdom but opens up new avenues for leveraging home equity strategically.

Age 62

At age 62, homeowners become eligible for a reverse mortgage. This is often considered early in one’s retirement planning journey, but starting at this age can offer significant long-term benefits. Establishing a line of credit through a reverse mortgage at 62 allows it to grow over time due to compounding interest rates. This means more available funds in the future when they may be needed most.

Still Working

Contrary to popular belief, being employed does not disqualify someone from benefiting from a reverse mortgage. In fact, continuing to work while having a reverse mortgage can be advantageous. It allows homeowners to make payments if desired, which can reduce the loan balance and increase the available line of credit over time. This proactive approach provides financial flexibility and security for future needs or unexpected expenses.

5-10 Years Left on Mortgage

Homeowners with only five to ten years left on their existing mortgages are particularly well-positioned for a reverse mortgage. This timeframe indicates significant equity build-up in the home, making it easier to qualify and potentially receive more substantial benefits from the loan. By converting part of this equity into accessible funds now, homeowners can eliminate monthly mortgage payments and improve their cash flow during retirement.

May Not Need Funds Immediately

One of the most compelling aspects of using a reverse mortgage as part of long-term financial planning is that immediate need isn’t necessary. Homeowners who do not require funds right away can still benefit by setting up a reverse mortgage early on. Doing so creates an additional layer of financial security that grows over time without tapping into other investments or assets prematurely.

For example:

  • Emergency Fund: Having an established line of credit provides peace-of-mind knowing there’s readily available money should any emergencies arise.
  • Supplemental Income: During market downturns or periods where other sources might falter (like Social Security), having access via your home’s equity ensures continued stability.
  • Healthcare Costs: As healthcare expenses typically rise with age; ensuring you have adequate resources becomes crucially important later down life’s path.

By considering these factors together – eligibility at age 62; employment status allowing continued payment contributions; nearing completion on current mortgages indicating high-equity positions; plus incorporating foresight rather than reacting out necessity – reveals how diverse candidates truly stand gain much more beyond mere desperation scenarios traditionally associated within public perception surrounding Reverse Mortgages today!

The ideal candidate isn’t just someone struggling financially but includes those looking proactively manage wealth efficiently throughout their golden year


Financial Planning with a Reverse Mortgage

Using a reverse mortgage isn’t just about accessing cash; it’s about smart financial planning. By incorporating a reverse mortgage into your broader financial strategy, you can create flexibility and security for future needs.

1. Building Equity Line of Credit (LOC)

One of the most compelling features of a reverse mortgage is the ability to build an equity line of credit (LOC). Unlike traditional loans, this LOC grows over time due to compounding interest rates. If you continue making payments while building your LOC, you effectively increase the amount available for future use. This approach allows homeowners to maintain or even grow their home equity, providing a robust safety net for unexpected expenses or opportunities that may arise later in life.

2. Supplement Retirement Income

A reverse mortgage can serve as an essential component of your retirement income strategy. Instead of relying solely on Social Security benefits or pension plans—which may not be sufficient—using funds from a reverse mortgage can supplement your monthly income. This additional cash flow can help cover living expenses, healthcare costs, or even fund leisure activities and travel during retirement years. The key is integrating it into your overall financial plan so that it complements other sources of income without depleting them prematurely.

3. Flexibility in Financial Decisions

One significant advantage of having a reverse mortgage is the flexibility it offers in making financial decisions. Unlike traditional loans where you’re required to make monthly payments immediately, a reverse mortgage allows you to draw funds as needed without immediate pressure to repay them. This means you have options: whether it’s taking out lump sums for large purchases or setting up regular monthly disbursements for consistent cash flow—you’re in control.

By incorporating these elements into your financial plan:

  • Emergency Fund: Establishing an LOC provides peace-of-mind knowing there’s readily available money should any emergencies arise.
  • Supplemental Income: During market downturns or periods where other sources might falter (like Social Security), having access via your home’s equity ensures continued stability.
  • Healthcare Costs: As healthcare expenses typically rise with age; ensuring adequate resources becomes crucially important later down life’s path.
  • Home Improvements: Use funds from the LOC to make necessary renovations that allow aging-in-place comfortably and safely within one’s own home environment.

Financial planning with a reverse mortgage isn’t merely about tapping into home equity but leveraging it strategically within one’s comprehensive retirement framework—offering both present-day benefits along long-term security!


A Real-Life Scenario

Consider Jane Doe at age 62:

Jane has been diligently paying off her mortgage and has about seven years left until it’s fully paid off. She’s still working full-time but wants to ensure she has enough resources when she retires at 67. By opting for a reverse mortgage now, Jane can strategically position herself for a more secure financial future.

1. Continues Making Payments:

By continuing to make payments on her existing mortgage, Jane reduces her loan balance over the next five years. This disciplined approach not only helps in managing her debt but also contributes positively towards building equity in her home.

2. Builds Up Her Line of Credit (LOC):

As Jane makes these payments, she simultaneously builds up her line of credit through the reverse mortgage. The LOC grows over time due to compounding interest rates applied positively towards it, meaning that even if she doesn’t need immediate funds, she’s creating a valuable financial resource for the future.

3. Secures Additional Funds:

With the compounding interest rates working in favor of her LOC, Jane secures additional funds that grow over time. This growing pool of money can be accessed whenever needed—whether it’s for unexpected medical expenses, home improvements, or simply supplementing retirement income.

This scenario illustrates how even those not needing immediate funds can benefit greatly from starting early with their reverse mortgage strategy:

Emergency Preparedness: Should an unforeseen event occur before or after retirement—such as job loss or health issues—Jane will have a readily available source of funds without having to liquidate other assets prematurely.

Retirement Security: Upon retiring at 67, Jane will have built up a substantial line of credit that provides peace of mind and financial flexibility during her golden years.

Financial Flexibility: Whether she chooses to draw lump sums for large purchases or set up regular monthly disbursements for consistent cash flow during retirement, Jane remains in control of how and when she uses these funds.

By incorporating this strategic use of a reverse mortgage into her broader financial plan while still employed full-time at age 62:

  • Jane maximizes both present-day benefits (like reducing current debt) along with long-term security (through an ever-growing LOC).
  • She ensures continued stability regardless if market conditions fluctuate adversely affecting traditional income sources like Social Security benefits/pension plans etc., thereby safeguarding against potential economic downturns impacting overall lifestyle quality post-retirement too!

Real-life scenarios such as this demonstrate why starting early with your reverse mortgage strategy isn’t merely about accessing cash immediately but leveraging it smartly within one’s comprehensive retirement framework ensuring optimal outcomes both now & later down life’s path!

Listen & Learn More!

For more detailed insights into how unconventional candidates like Jane can benefit from reverse mortgages, tune into our latest podcast episode where Bruce Simmons dives deeper into these topics!

🔗 Listen Now

And don’t forget! Download our comprehensive guide on understanding reverse mortgages today!

📥 Download The Guide Now

Empower yourself with knowledge and make informed decisions about your financial future!

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Bruce Simmons

I absolutely love what I do - working with senior homeowners to help them live a more comfortable, flexible and secure retirement. I have the absolute best customers in the world, and even though I worked in the forward mortgage business for a number of years, I could never go back to doing conventional loans. I'm a 100% reverse mortgage specialist.

5.0

My wife and I are retired and had a mortgage that was quite high. We contacted Bruce regarding a Reverse Mortgage and were pleased with his knowledge and experience. He made the whole process very easy and explained everything along the way. Since then, I have had a couple of questions and contacted him regarding the RM. Bruce has always been very responsive and returned our calls within minutes. We couldn't be happier having used Bruce for the Reverse Mortgage and highly recommend him.

Bruce has been serving my interest over and above what one might expect during the whole process of handling my reverse mortgage dating back to 2010 and continues to be available at present whenever a question may arise. He is one of the most reliable, trustworthy and knowledgeable experts regarding reverse mortgages that I have had the privilege to do business with! I would highly recommend Bruce to anyone who is considering a reverse mortgage. Thank you Bruce!

I met Bruce from a referral who just love what he did for them on their Reverse Mortgage, So I contacted Bruce and told him my story and he came up with a great Reverse Mortgage for me and my needs and now I am living good and not worrying about Finances anymore. He had it done in a timely manner. If you are looking for the MAN to help you get the best Reverse Mortgage you need to call him and hope you let him help you.

Bruce is one of the most professional, knowledgeable and efficient experts I have worked ŵith ever in any field. He is fast to answer and always ready to help...and he's a great guy!

Gerald Cook
Gerald Cook
5.0

Bruce did our original reverse mortgage and has also refinanced it twice. He works hard to get the best deal possible while making it as easy for us as possible. When our first refinance received a low initial appraisal, Bruce helped the appraiser find better information and increase the appraised value. He's the best.

I was hesitate about getting a reverse mortgage until Bruce Simons put my mind at rest. He is easy to work with, extremely knowledgeable and efficient. Things get done and he will make sure that you understand every part of the process. I interviewed several other people and he was hands down.....The only choice.

Doing a Reverse Mortgage is a major decision, when working with Bruce he came out personally to go over every thing in detail, there was no pressure to finalize the transaction, I had even put the loan on hold for awhile even though I had locked in my rate, I had called Bruce off and on for a few weeks to ask questions that I had concerns about and he was always available to talk to me. In the end it gave me time to feel comfortable about my decision to move forward with the Reverse. Bruce was very pleasant to work with and would certainly recommend Bruce if you are going to consider a Reverse Mortgage.

Bruce Simmons at American Liberty is one of the best in the reverse mortgage industry. I have known and worked with him for years and he always does a great job. You are in good hands with Bruce and know that he will take good care of you or your loved ones every step of the way.

Best thing I ever did! Bruce Simmons at American Liberty Mortgage is the best. He is always there to answer your questions, and can easily explain the whole idea of a Reverse Mortgage. He takes the time and goes through the entire process with you. It worked out so well for me. Thank You Bruce!

We had researched Reverse Mortgages for 5 years and after hearing about Bruce Simmons and meeting with him, we finally decided to move forward with the Reverse Morgage. It has been over a year now and we are still very pleased with our decision. We think Bruce is very professional, knowledgeable and honest. Thank you, Bruce, for all your help.

I first met Bruce Simmons 2017. I found him on the internet. I was looking for someone local. I called him and explained I was only looking into doing a reverse mortgage, so I did not want him to think this was something I was ready to do. Bruce was friendly, very open about the basics of a reverse mortgage. Bruce came to my home and presented the figures and other details that he could offer. The first thing that impressed me was this was not a hard sell, more of a informational meeting. He was very open about all of the details, and answered my questions without hesitation. What really was evident was he was establishing a relationship with me, and I realized he knew I would not take the loan at that time. There was not enough equity in my home, and I would have to bring money to the table. Although I was not ready to do a loan, Bruce assured me he is always available for questions. Four years later, I finally did do a reverse mortgage, and I couldn't be happier with having done it. I have done away with a mortgage payment which allows me to fund my retirement account with that mortgage payment. We did some much needed landscaping with our cash out transaction, and will move on to improvements inside of the house. My reverse mortgage has a line of credit, and I feel sense security knowing it is there if I need it. Bruce explained that a reverse mortgage is not for everyone, but I feel certain that he paved the way for a strategy that worked for me. I will definitely do a refinance when the time is right. I will check in with Bruce to be sure what the benefits are when I do it again.

I have worked with Bruce Simmons for 15 years. Bruce is one of the best in the industry. He is extremely knowledgeable, kinds and detailed in what he does. His clients love working with him and trust him to help them with their Reverse Mortgage loans. I would recommend Bruce to anyone I know that is thinking about or wanting to do a Reverse Mortgage. He will always take very good care of the customers and make sure their needs are met! Class act and one of the best in the industry by far!

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John Addante
John Addante

Left us a 5 star review

My wife and I are retired and had a mortgage that was quite high. We contacted Bruce regarding a Reverse Mortgage and were pleased with his knowledge and experience. He made the whole process very easy and explained everything along the way. Since then, I have had a couple of questions and contacted him regarding the RM. Bruce has always been very responsive and returned our calls within minutes. We couldn't be happier having used Bruce for the Reverse Mortgage and highly recommend him.

Bruce has been serving my interest over and above what one might expect during the whole process of handling my reverse mortgage dating back to 2010 and continues to be available at present whenever a question may arise. He is one of the most reliable, trustworthy and knowledgeable experts regarding reverse mortgages that I have had the privilege to do business with! I would highly recommend Bruce to anyone who is considering a reverse mortgage. Thank you Bruce!

I met Bruce from a referral who just love what he did for them on their Reverse Mortgage, So I contacted Bruce and told him my story and he came up with a great Reverse Mortgage for me and my needs and now I am living good and not worrying about Finances anymore. He had it done in a timely manner. If you are looking for the MAN to help you get the best Reverse Mortgage you need to call him and hope you let him help you.

Bruce is one of the most professional, knowledgeable and efficient experts I have worked ŵith ever in any field. He is fast to answer and always ready to help...and he's a great guy!

I was hesitate about getting a reverse mortgage until Bruce Simons put my mind at rest. He is easy to work with, extremely knowledgeable and efficient. Things get done and he will make sure that you understand every part of the process. I interviewed several other people and he was hands down.....The only choice.

Doing a Reverse Mortgage is a major decision, when working with Bruce he came out personally to go over every thing in detail, there was no pressure to finalize the transaction, I had even put the loan on hold for awhile even though I had locked in my rate, I had called Bruce off and on for a few weeks to ask questions that I had concerns about and he was always available to talk to me. In the end it gave me time to feel comfortable about my decision to move forward with the Reverse. Bruce was very pleasant to work with and would certainly recommend Bruce if you are going to consider a Reverse Mortgage.

Bruce Simmons at American Liberty is one of the best in the reverse mortgage industry. I have known and worked with him for years and he always does a great job. You are in good hands with Bruce and know that he will take good care of you or your loved ones every step of the way.

Best thing I ever did! Bruce Simmons at American Liberty Mortgage is the best. He is always there to answer your questions, and can easily explain the whole idea of a Reverse Mortgage. He takes the time and goes through the entire process with you. It worked out so well for me. Thank You Bruce!

We had researched Reverse Mortgages for 5 years and after hearing about Bruce Simmons and meeting with him, we finally decided to move forward with the Reverse Morgage. It has been over a year now and we are still very pleased with our decision. We think Bruce is very professional, knowledgeable and honest. Thank you, Bruce, for all your help.

I first met Bruce Simmons 2017. I found him on the internet. I was looking for someone local. I called him and explained I was only looking into doing a reverse mortgage, so I did not want him to think this was something I was ready to do. Bruce was friendly, very open about the basics of a reverse mortgage. Bruce came to my home and presented the figures and other details that he could offer. The first thing that impressed me was this was not a hard sell, more of a informational meeting. He was very open about all of the details, and answered my questions without hesitation. What really was evident was he was establishing a relationship with me, and I realized he knew I would not take the loan at that time. There was not enough equity in my home, and I would have to bring money to the table. Although I was not ready to do a loan, Bruce assured me he is always available for questions. Four years later, I finally did do a reverse mortgage, and I couldn't be happier with having done it. I have done away with a mortgage payment which allows me to fund my retirement account with that mortgage payment. We did some much needed landscaping with our cash out transaction, and will move on to improvements inside of the house. My reverse mortgage has a line of credit, and I feel sense security knowing it is there if I need it. Bruce explained that a reverse mortgage is not for everyone, but I feel certain that he paved the way for a strategy that worked for me. I will definitely do a refinance when the time is right. I will check in with Bruce to be sure what the benefits are when I do it again.

I have worked with Bruce Simmons for 15 years. Bruce is one of the best in the industry. He is extremely knowledgeable, kinds and detailed in what he does. His clients love working with him and trust him to help them with their Reverse Mortgage loans. I would recommend Bruce to anyone I know that is thinking about or wanting to do a Reverse Mortgage. He will always take very good care of the customers and make sure their needs are met! Class act and one of the best in the industry by far!