Four Money Options with a Reverse Loan

Alright, here is the third part of a long article that discusses the various payment options from a Reverse Mortgage.   And the one that is overlooked and could be very beneficial to the borrower, is the Tenure payment.

Part III

New Research Shows Financial Planning Value of Tenure Reverse Mortgages
Posted ByJason OlivaOn March 3, 2016

“Although the popular financial approach to generating retirement income has been to rely on systematic withdrawals from investments, such as stocks and bonds, the researchers suggest planners have two additional options worth considering: reverse mortgages and annuities.

“Such options may be particularly useful for clients whose finances are constrained and they need to either generate more retirement income or make the income more secure,” write Tomlinson, Pfeiffer and Salter.

An issue for planners, they suggest, is how to choose among these two options and how to combine these alternatives in a way that best meets client needs.

Ideal candidates for annuities, particularly SPIAs, are those who need more security so that their retirement income will last for life, and can tolerate the illiquidity that a SPIA entails, according to the study. Whereas for reverse mortgages, ideal candidates are those who need additional retirement income, plan to stay in their home for life, have adequate long-term care insurance and do not plan on leaving a bequest.”

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Tenure Payments and HECM’s

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