MortgageReverse Reverse Mortgages Can Help Reduce Aging in Place Costs

A big barrier that may exist for seniors who wish to age in place can be the costs that are often associated with remaining at home. These costs are, typically, very familiar to reverse mortgage industry participants: taxes, homeowners insurance, and the cost of general home upkeep and maintenance.

For seniors who may have difficulty meeting these obligations, a possible solution that may not have been considered for a number of reasons could be a reverse mortgage, according to a new column published by

“[Older adults] are certainly vulnerable, and I think it’s not intuitive they would be,” says Geoffrey T. Sanzenbacher, a research fellow at the Center for Retirement Research at Boston College to

While rising home values could be the source of certain headaches for senior homeowners, they may also help to provide additional stability through a reverse mortgage loan, the column reads.

“A similar option to property tax deferrals, reverse mortgages are loans that rely on your house as collateral,” the column reads.

“A reverse mortgage is like a forward mortgage in that it involves a loan which is secured by the house,” says Jack Guttentag, retired economist who is also known as “the Mortgage Professor,” in an interview with the outlet. “What makes it reverse is that the borrower, instead of getting a large amount of money upfront and paying it off over time, receives money in a variety of possible ways and doesn’t have to repay it until he leaves the house or dies.”

While reverse mortgages are increasingly used strategically by seniors as a way to bolster quality of life in later years, judicious use of a reverse mortgage loan’s proceeds is generally a better way to make use of such a financial instrument, Guttentag says.

“The better option is the one that best meets the needs of the particular homeowner,” Guttentag tells “Too many take out reverse mortgages in cash in the first year, and then they have nothing left later. That’s a poor option but it’s one that people who are in financial distress may select. The safer option is the [tenure] payment where you get a payment every month while you live in the house.”

Read the column at

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