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Scott Underwood
Alabama's Reverse Mortgage Guy and Vice President New South Mortgage Reverse Mortgage Div
Alabama's Reverse Mortgage Guy and Vice President New South Mortgage Reverse Mortgage Div

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I thought I would mix thing up and report a news story on Australia's Revere Mortgage world. Australia's Only Independent Mortgage Website

Home News Cash-strapped retirees turning to reverse mortgages
Cash-strapped retirees turning to reverse mortgages. By Michael Mata

To cope with the cost of retirement, many cash-strapped and asset-rich retirees are turning to reverse mortgages.

Changes to the age pension assets test came into effect on 1 January. This affected hundreds of thousands of retirees, some for the better and some for the worse. Many had to go back to the drawing board and work out how they could live out their retirement years in comfort.

Roughly 300,000 retirees on the part-pension had their entitlements reduced, and 100,000 lost all their entitlements. With fewer benefits coming in, it’s easy to understand why so many retirees are turning to reverse mortgages.

What is a reverse mortgage? A reverse mortgage is a type of home loan that enables you to borrow money using the equity in your home as security. The reverse mortgage loan can be taken as a lump sum, a regular income stream, a line of credit, or a combination of these options.

Just like any other loan, interest is charged, except that borrowers don’t have to make repayments while they live in their homes. The interest compounds over time and is added to the borrower’s loan balance. Borrowers remain the owner of their homes and they can stay in them as long as they want.

Borrowers settle the loan in full, including interest and fees, when they sell their homes or die, or if they move into aged care.

To learn more about the different types of reverse mortgage home loans, check out this search tool.

The risks . The interest rates for reverse mortgages are generally higher than for average home loans. According to InfoChoice, interest rates range around 7%, and there can be establishment costs as high as $1,050 as well as ongoing costs.

The debt can also rise quickly as the interest compounds over the term of the loan. This is the effect of compound interest and is something you need to be aware of before you commit to a reverse mortgage.

Just as importantly, taking out a reverse mortgage could also affect your pension eligibility.

Seek independent advice . It’s vital for those who’re considering reverse mortgages to seek independent advice, said Miles Larbey, senior executive leader at ASIC’s Moneysmart.

“You need to think about the debt and the fact [that] interest will be compounding on the reverse mortgage,’’ he said. “Definitely speak to your nearest and dearest and also seek legal advice.”

It can be confusing to know whether to get a variable rate or fixed rate mortgage, and what features are important. That's why it's important to not only check the right rates, but make sure that you're getting the right features in your home loan. Get help choosing the right home loan

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Scott Underwood is the source for Reverse Mortgages and Reverse Mortgages to buy your next home in Alabama. I have 11 years experience,, and my partnership as V.P. of New South mortgage. The only lender in Alabama. You receive the best service in person, not over the phone, the best costs, and with everything done in Alabama, your closing is quick. Ask your financial planner, or Realtor; the new safer Reverse Mortgage is not the same as before and the national news sources agree. Look at my "news" section on 

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Things always change, don't be caught standing still...

We are the #1 and only true Alabama lender, we can use Alabama providers to save money, and close is well under a month. You don't have to accept doing this huge transaction via phone calls.

Call me today for any type Reverse Mortgage or the Reverse Mortgage to purchase your next home (HECM Purchse). I have well over 10 years experience, so I can make this painless for you!

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Midwestern Cities are the best for retirement??

Re-post. Eight ways to retire on less. About Money By Scott Spann. Retirement Planning Expert.

The average household spends about one-third of their income on housing expenses alone. If you are preparing for retirement and are looking for ways to cut back on future living expenses your house is often a good place to start trimming costs. The most common housing solutions typically include selling a house. But there are other potential ways to lower your housing expenses for retirement.

Don’t let housing expenses hold you back from retirement

1. Pay off your mortgage early. Should you pay off your mortgage prior to retirement? This is a common question people ask as retirement approaches. While you should always weigh the pros and cons of this decision, there is something to be said about reaching your retirement years completely mortgage debt-free. You will still be responsible for other housing costs such as property taxes, insurance, maintenance and repairs. But the elimination of your mortgage payments could significantly improve your retirement outlook.

2. Sell your home and “right size” your housing expenses if you have accumulated significant equity in your home it may make sense to sell your home and use the proceeds to purchase a less expensive residence. You probably have heard the term “downsizing” used to describe this process. Perhaps “rightsizing” is a more appropriate way to label this process. If your children have already left the home you may have more house than is needed and it’s time to match your living quarters with your future retirement expenses.

3. Buy a home with a reverse mortgage. A reverse mortgage (a.k.a. “Home Equity Conversion Mortgage”) is a type of mortgage that allows homeowners to borrow against the equity in their primary residence. Reverse mortgages are commonly used to generate extra retirement income. However, another way to strategically use a reverse mortgage during retirement is to purchase a home. If you are seeking a cost effective way to downsize your housing expenses, find a more suitable home for your planned retirement lifestyle, or simply looking to relocate to another location you can actually buy a home using a reverse mortgage. Unlike your traditional forward mortgage, no monthly payments are required with a reverse mortgage making this a potential way to buy a more suitable property with no monthly payments.

4. Retire abroad to a lower cost of living. Retiring to a foreign country has become an attainable goal due to greater ease and affordability. There are many countries that offer an excellent quality of living for expats. If you have ever dreamed of living abroad be sure to consider the logistics of travel expenses, health care, and lifestyle.
There are a number of locations in almost every part of the world that have a lot to offer retirees. Below is a list of picks for 10 locations, based on affordability, community, cultural activities and proximity to the United States.

5. Live on a boat or RV. If you are seeking adventure during your financial freedom years you may have dreamed about traveling the country in an RV or living on a boat. This could be a way to combine your passion for travel with a potentially cost-effective way to go off the grid during retirement. Your expenses really depend on your tastes and preferences here. Some recreational vehicles are anything but cost-effective while others provide more bang for their buck. The same thing applies with cabin cruisers and sailboats. While most retirees do not make RV or boat living a full-time endeavor, this could be a creative way to retire on less.

6. Take a tribal approach to retirement. The idea of living with children or siblings may not be your perfect vision of retirement, but it is a legitimate solution and could be a win-win scenario. The key is to set boundaries and expectations early to avoid emotional meltdowns. The “tribal” concept of retirement living isn’t quite so unique in many cultures and traditions where this is the norm rather than the exception to the rule. Another version of this tribal approach to sharing expenses in retirement is often referred to as the “Golden Girls solution”. If you have a few like-minded friends seeking creative ways to lower their expenses in retirement your housemates could help you bridge the retirement income gap.

7. Retire big with a tiny house. The tiny house movement has been gaining momentum in recent years. If you have watched one of the numerous documentaries or television programs that highlight tiny house living you may have wondered what the heck those people were thinking. But if you were inspired by the concept of living big on less you may be attracted to concept of living an extremely frugal lifestyle in retirement. Tiny houses are popping up across the country and they combine style with functionality with minimal square footage (usually less than 400 feet).

8. Use your house to generate extra income. If you do not have any plans to move or downsize you can still use your current residence to generate extra income during retirement. With the sharing economy in full gear you can use sites like Airbnb and VRBO to rent out an extra room or your entire house while you are traveling or staying with friends and family.

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Reverse Mortgage simply explained. Call Scott Underwood for local information at 205.908.2993. Reverse Mortgage Alabama

The Reverse Mortgage Purchase is getting more popular. Great way for people age 62 and above to get more home for less money. Realtors need to have this extra option available 
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