Episode•October 3, 2023•26 min

Learn The TRUTH About Reverse Mortgages with Todd Christensen | Ep. 268

Get the facts about reverse mortgages in this informative episode with Todd Christensen. Learn why reverse mortgages are restricted to those 62 years old and over, how reverse mortgage proceeds can be used, and discover creative ways to use a reverse mortgage. Plus, get tips on other options that may be available for homeowners interested in tapping into their home equity without a monthly mortgage payment. Don't miss this informative episode about reverse mortgages! About Our Guest Author, Accredited Financial Counselor®, and HUD-certified housing counselor Todd R. Christensen, MIM, is an Education Manager at Money Fit by DRS, Inc., a nationwide nonprofit credit counseling agency. Todd develops educational programs and produces materials that teach personal financial skills and responsibilities to all ages. In addition to over a thousand counseling sessions, Todd has facilitated more than 2,000 workshops since 2004 on effective personal financial management. His experiences serve as the basis for his first book, Everyday Money for Everyday People (2014), sharing the discussions, tips, stories, and ideas used by the tens of thousands of participating individuals and couples. Connect with Todd Website: https://moneyfit.org Email: [email protected] Facebook: Money Fit by DRS Twitter: @MoneyFitbyDRS Connect with Tiffany Visit our website: https://moneytalkwitht.com Facebook: Money Talk With Tiff Twitter: @moneytalkwitht Instagram: @moneytalkwitht LinkedIn: Tiffany Grant Additional Resources & Links Episode 188 - Spending Personalities with Todd Christensen This podcast uses the following third-party services for analysis: Podcorn - https://podcorn.com/privacy OP3 - https://op3.dev/privacy

Apple Podcasts Spotify YouTube Overcast Amazon Music

Key Takeaways

Reverse mortgages allow homeowners 62+ to tap home equity without monthly payments

Lender pays off existing mortgage and provides cash via lump sum, term, or lifetime payments

Loan is repaid when borrower passes away, moves out, or sells the home

Interest accrues over time so the mortgage balance increases rather than decreases

Spouse protections require being on the title or as co-borrower

If spouse is on title, they can remain in the home even if borrower passes away

Payments may stop but residency rights are protected

New spouses after the reverse mortgage do not receive the same protections

Reverse mortgages have strict ongoing requirements to avoid default

Must live in the home at least 6 months and 1 day per year

Must pay property taxes, HOA fees, and maintain the property

Failure to meet these obligations can result in foreclosure

Reverse mortgages can be used for creative purposes beyond basic cash flow

Can purchase a second home or multi-unit property (duplex, triplex, fourplex)

Live in one unit and collect rental income from others without mortgage payments

Proceeds can be used for any purpose including debt consolidation

Reverse mortgages are not inherited debt and can be refinanced or paid off early

Heirs are not personally responsible for the loan beyond the home's value

Can refinance into a conventional loan if equity allows

Can sell the home at any time and keep remaining equity

Intro

Tiffany Grant welcomes back returning guest Todd Christensen to demystify reverse mortgages, a financial tool often misunderstood due to infomercial marketing.

Todd R. Christensen, MIM, is an Accredited Financial Counselor and HUD-certified housing counselor at Money Fit by DRS, Inc. He has facilitated over 2,000 workshops since 2004 and authored Everyday Money for Everyday People.

Learn The TRUTH About Reverse Mortgages with Todd Christensen | Ep. 268

Key Takeaways

Intro

– What Are Reverse Mortgages?

– Why Age 62 Requirement?

– Spouse Protection Rules

– Creative Uses and Alternatives

– Who Should Avoid Reverse Mortgages

– Exit Strategies and Refinancing

Books Mentioned

Resources

Topics