Can you imagine working hard your entire career, finally reaching retirement and not having enough money to enjoy it? It’s a scary scenario, but one that many face because of a lack of planning during their career years.

Not having retirement savings is a big problem, according to a survey that found that four in ten U.S. employees (40 percent) don’t believe they will ever have enough saved up for retirement. That number is in contrast to the 20 percent who report that saving for retirement is their top financial goal.

Those numbers aren’t very optimistic, but there is good news for those who think they may be running out of time to set themselves up for a comfortable retirement. If you find yourself in this situation, an HECM loan* could be the solution you’re looking for.

This type of loan allows homeowners to borrow from the value of their home without making payments. Essentially, you keep the title to your home, and the bank recoups the money you borrowed later on once your house is sold, if property taxes or homeowners insurance goes unpaid, or after you pass away.

Here a few quick facts about HECM loans:

  1. Typically, there are no limits on what you can use the money for, so it can be used for everything from travel to medical bills.
  2. Several factors determine eligibility, including age (you must at least 62), homeownership status (you must own or have a low mortgage balance) and general lending requirements.
  3. Funds are distributed based on the rates; a fixed-rate loan is paid in a lump sum and an adjustable-rate loan gives you the option of being paid in monthly payments, as a line of credit, or as a lump sum.
  4. If you apply for a HECM loan and change your mind, you will have a three-day window to cancel.
  5. Your family members may end up incurring your debt after you pass if you take out this type of loan and it’s recommended that you discuss this with them.

I want to educate you on the right decisions for your financial future and I’m here to help answer any questions you may have to make sure you enjoy your retirement to the fullest. Don’t hesitate to reach out!

*(1) at the conclusion of a reverse mortgage, the borrower must repay the loan and may have to sell the home or repay the loan from other proceeds; (2) charges will be assessed with the loan, including an origination fee, closing costs, mortgage insurance premiums and servicing fees; (3) the loan balance grows over time and interest is charged on the outstanding balance; (4) the borrower remains responsible for property taxes, hazard insurance and home maintenance, and failure to pay these amounts may result in the loss of the home; and (5) interest on a reverse mortgage is not tax-deductible until the borrower makes partial or full re-payment. This material is not from HUD or FHA and has not been approved by HUD or any government agency.