Stabilize Spendable Funds When Income Fluctuates - Reverse Mortgages

Stabilize Spendable Funds When Income Fluctuates
Stabilize Spendable Funds When Income Fluctuates - Reverse Mortgages

The senior with fluctuating income can use a HECM credit line profitably to stabilize her spendable funds. She does this by drawing on the line when income drops, and repaying the line when income is high. The benefit, as contrasted to using a bank account in the same way, is that the investment return earned on repayments is the mortgage rate plus the mortgage insurance premium, which is much higher than any deposit rate they can earn at a bank.

Print