Divorce has declined in the US for everyone except couples over the age of 50, whose rate has doubled since 1990. Divorcing later in life is not a new phenomenon, but it is becoming more and more common. Indeed, the increased occurrence of “gray divorce,” as it’s called, has been identified as a significant 21st century divorce trend. Even though the overall divorce rate is actually declining, it’s on the rise among older generations. A reverse mortgage was created specifically for senior homeowners, 62 years and older, who want to convert part of their home’s equity into loan proceeds.
With not only the rising financial requirements of senior homeowners but when there is limited or fixed income in a divorce situation, a reverse mortgage is becoming a popular option and tool to supplement income.
How Can a Reverse Mortgage Help Your Divorcing Clients?
A reverse mortgage can help your divorcing client in a number of ways, including:
Flexible Payout Options can be a great advantage to divorcing seniors!
- Line of credit (allows borrower to draw on loan proceeds as needed)
- Fixed monthly payments for a set term (allows the ability to create an income stream)
- In a lump sum
- Or a combination of the above (may provide for an equity buy out as well as creating an income stream)
A reverse mortgage can be used for several things including:
- Paying off existing mortgages with loan proceeds
- Covering healthcare costs
- Paying taxes and insurance
- Making home modifications
- Or simply building a reserve fund
How a CDLP Can Help During the Divorce Process
A CDLP™ brings tremendous value to the divorce team during the settlement process because of their stronger perspective of the entire divorce process. Their understanding of the intersection of family law, tax law, real estate and mortgage financing truly separates them from other mortgage professionals in the industry.
A successful divorce settlement is the result of putting the pieces of the puzzle together in such a manner that both divorcing spouses come out of the divorce whole. Each member of the professional divorce team should bring value and perspective that benefits the overall outcome and success.
Always work with a Certified Divorce Lending Professional (CDLP™) when going through a divorce and real estate or mortgage financing is present.
This is for informational purposes only and not for the purpose of providing legal or tax advice. You should contact an attorney or tax professional to obtain legal and tax advice. Interest rates and fees are estimates provided for informational purposes only and are subject to market changes. This is not a commitment to lend. Rates change daily - call for current quotations. The information contained in this newsletter has been prepared by, or purchased from, an independent third party and is distributed for consumer education purposes.