Thinking About Your Home Value Differently.

I often ask new clients what they think their home is worth. Not surprisingly, the answers I get back are usually overly-optimistic. Nonetheless, these clients often have a very strong sense of how much their home is worth to them. In fact, I find that people who come to me looking for reverse mortgages are particularly good at separating the intrinsic value of their home from its market value.

Despite the constant movements in real estate prices, the inherent value that a home has to a borrower is usually much higher than market value. Our homes are more than cinder blocks and wood. They often represent the very essence of our lifestyles and are the places that give us the most comfort. The value of these aspects of our home cannot be quantified in the open market. For many individuals, these inherent aspects of our homes represent the most important and meaningful parts of a home that can’t be value through an appraisal or sale of the home.

Nonetheless, the market price of a reverse mortgage borrower is largely secondary. These individuals usually are not planning to sell their home any time soon and the fair market value of their home is only relevant in as much as it determines how much they can borrow in a reverse mortgage. The real issue that these borrowers contend with is how to properly allocate their retirement assets. These borrowers understand that having a majority of their retirement assets tied up in one place may not be the most conservative and effective strategy for their retirement savings. These individuals usually are keenly aware that their home equity is most efficiently put to use when its considered a part of their overall retirement planning.

Just because a reverse mortgage may make sense for your individual circumstances does not mean that you shouldn’t be very careful and thoughtful in developing an overall strategy to put those funds to work. Smart reverse mortgage borrower look at reverse mortgage proceeds as but one tool in their retirement arsenal. How you ultimately use your funds is, of course, entirely your decision. However, individuals would be well advised to cautiously develop an overall retirement strategy before withdrawing any money out of their equity.

Seniors who carefully consider their overall financial picture and include their home equity in their retirement planning are more likely to live comfortably during their later years. Seniors who ignore their home equity are missing one of the largest pieces of their retirement puzzle. Although these loans are not appropriate for everyone under every circumstance, if your home consists of a large part of your net worth, you should definitely think about reverse mortgages and how they may help your retirement planning.

If eliminating monthly mortgage payments, increasing cash available during your retirement years and maintaining ownership in your home for the foreseeable future sounds like a solid long-term solution to your financial needs, then a reverse mortgage may be the right option for you. Check it out today. The information is free and the benefits may be enormous.

Looking for more information on a guide to reverse mortgages or lowest mortgage refinance rates? Then make sure to check out Tim Begert’s online resources.

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