Retirement income is often insufficient to pay for costly repairs.
Accessing equity to maintain the home has two purposes.
It ensures the value of the family home is not diminished due to disrepair.
Additionally, a 10 years study in Victoria has indicated 31% of seniors’ home have a “slip and trip” fault, which may lead to an admission to hospital.
A further 23% of homes had an electrical fault.
A reverse Mortgage can ensure appropriate repairs such as flooring and electrical work are carried out and provide greater safety for the occupants.
It also means a facelift, however small, is possible. Many retirees want to stay in their home, not only feeling safe, but enjoying their surroundings and keeping their property maintained.
Mary and John had elected to retire early when John was made redundant at age 62. They had $42,000 owing on their home and their mortgage repayments were only $56.00 per week. John had $58,000 in his super account that they rolled into an allocated pension. After 4 years of retirement, their car needed replacement and they were finding life difficult. They had been considering selling their home of 12 years and downsizing to a smaller house or unit. They did NOT want to move from their suburb and were concerned at the $15,000 costs of changing their home.
Paul arranged a Reverse Mortgage loan with an initial lump sum sufficient to cover the cost of paying out their mortgage loan, the new car and some small house renovations, with an ongoing monthly instalment of $300.00.
For Mary and John
They had saved $56.00 a week that they were no longer paying on their mortgage.They also saved the $15,000 change over costs by not selling and buying another property.They had an extra $300.00 per month to spend AND they had a new car!They will continue to own their home, and will be able to reduce any decrease in value.
They removed the burden of a mortgage.
They were able to free up money to create the home they wanted (and needed) in their retirement.
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More than two decades’ experience consulting with senior Australians and Self-Funded Retirees regarding specialist credit products designed to support retirees.
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