AARP Survey Says Reverse Mortgages Have Positive Effect

AARP’s Public Policy Institute reported that 93% of the seniors that have taken out a reverse mortgage said that the loan has had a positive effect on their lives. Another 63% said that they would be “very likely” to recommend a reverse mortgage to a friend.

Federally insured reverse mortgage loans, created 20 years ago, have dramatically increased in popularity in recent years. More than 400,000 seniors have taken advantage of a reverse mortgage since their inception. However, according to John Rother, AARP Director of Policy and Strategy, only 1% of eligible older homeowners are currently using a reverse mortgage. This is expected to change as the retirement population begins to explode with the aging of the baby boomers.

Reverse mortgages provide seniors the ability to “age in place” while still offering the financial flexibility to access home equity without taking on any monthly payments or more overall debt. Simply put, they help seniors remain independent longer.

According to the National Council on Aging, an estimated 9.8 million older Americans have an impairment that makes it difficult to live at home. A reverse mortgage can help seniors pay for long-term care and remain independent in their own homes longer. Many homeowners use reverse mortgage funds to make their homes more accessible, such as wheelchair ramps, chair lifts, and bathroom and kitchen upgrades for the handicapped.

AARP has published an excellent consumer guide for seniors considering a reverse mortgage. It is called “Home Made Money” and you can obtain a free copy here. You can also receive a free reverse mortgage benefit summary that will show you whether you have enough equity in your home to qualify for a reverse mortgage. There is no obligation for you to receive either of these reports.

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