Deciding If a Reverse Mortgage is Right for You

The reverse mortgage industry has received its share of negative press; however, much of this criticism is due to a lack of education and misconceptions about the product.

“Many senior homeowners who could truly benefit from a reverse mortgage have been discouraged from even looking into one by well-meaning – but misinformed – family and friends.  I believe that a senior who receives factual and accurate information will be better able to make the right decision about a reverse mortgage,” says Alain Valles, a Certified Reverse Mortgage Professional and President of Direct Finance Corp. in New England.1

Reverse mortgages can be confusing, so it’s important to be informed and separate fact from fiction. Invite your family to be part of the process as well, so that everyone is on the same page. Below are some tips to help you decide if a reverse mortgage is right for you:

Identify Your Retirement Goals

Identify your financial and housing goals for retirement. How would you like the next 20-30 years to look? For example, do you need extra cash to supplement your income, make home improvements, or pay off your mortgage and/or credit card debt. Or maybe your financial situation is secure now, but you’re concerned about outliving your assets and having enough down the road, such as for unexpected medical costs. Do you prefer to stay in your current home throughout retirement or are you considering downsizing and/or renting at some point in the future?  These are all important questions to ask yourself.1

Get the Facts

Educate yourself about the product and what triggers can cause the loan to come due. Ensure that you’re working with a lender who is a member of the National Reverse Mortgage Lenders Association (NRMLA). This is important because NRMLA members are required to follow the association’s strict code of ethics. You can also visit NRMLA’s informational website to find lenders that are current members of NRMLA.1

Obtaining a reverse mortgage also requires you to speak with a Department of Housing and Urban Development (HUD) approved counselor. In addition to providing you with an unbiased source of information, the purpose of the counseling session is to:

  1. Ensure you understand the features, benefits and obligations of a reverse mortgage
  2. Explore your options and help determine whether this product is right for you

Include Your Advisor

Whether your trusted advisor is a financial planner, attorney, or your adult child, any reputable lender will encourage you to include your advisor in the learning process. If they discourage this for any reason, then be skeptical.1

Make a Decision

The key to achieving your financial goals is educating yourself and being proactive. “Hoping things will magically get better usually results in more financial pain. Waiting might lead to regret,” says Valles.1

If you’d like to find out if a reverse mortgage loan is right for you, please use our Reverse Mortgage Calculator or call us at 800.218.1415.


1 Reverse mortgages – good to be skeptical –, by Alain Valles, 10/29/16,

Author:  Meredith Manz