Over the weekend, New York Times journalist Elsa Brenner writes that retirees are turning to reverse mortgage to meet their expenses and in places where property taxes are high, these loans have become more popular.
Stephen Lamoreaux, a reverse-mortgage specialist in Stamford, Conn., who serves clients in New York and Connecticut for Wells Fargo Home Mortgage, is one expert who has noticed a surge in interest in reverse loans. “The property-tax issue is really driving business these days,” he said.
Because of high taxes, residing in Westchester during one’s old age — even if the mortgage is paid off — can be far more costly than doing so, for instance, over the line in Connecticut. Annual taxes on a four-bedroom house in Larchmont on the market for $1.239 million are $24,049; in Greenwich, the tax bite for a similarly priced house is $6,433.
On top of that, selling to move has become problematic, said Bernard A. Krooks, a partner in Littman Krooks, a New York City law firm with an office in White Plains. A retiree “may have planned to sell the house and move to a condo,” said Mr. Krooks, who specializes in elder law, “but things aren’t moving that well in this market. The timing for them is bad.”
According to the federal government, the volume of reverse mortgages increased 24 percent in March compared with February , setting a national monthly record of 11,261 reverse-mortgage loans. And as the market for them booms, the profile of those using them is expanding, Mr. Lamoreaux said. “It used to be just the 75-year-old widow,” he added, “but that’s not so anymore.”
