Get Serious About Selling to Seniors- Sell More Life and LTCi!

There are so many financial planning strategies that do sense when using contrary mortgages. Some modern times grownup children of aging parents need just as much or more than instruction than the seniors themselves. After all, this is a relatively new concept, and often looks to good to be true. The of import thing to retrieve is that contrary mortgages (also called Home Equity Conversion Mortgages) are backed by the federal government, and protections have got been set in topographic point for seniors and their families.

Heirs need to understand that with proper estate planning, they stand up to come into more than than the value of their parent’s home. A contrary mortgage is one manner to do that happen.

The National Council on Aging supports and advocators the usage of contrary mortgages for long-term care planning and for managing the crisis of long-term care. Obviously, there are modern times when a client will not measure up for long-term care insurance, but fortunately, if they are a homeowner, there are still ways that we can assist them. That’s wherefore it’s sol of import for you to cognize the rudiments about contrary mortgages. Anyone who functions the senior market should have got access to this of import financial planning tool. For the NCOA statement and fourth estate release travel to www.ncoa.org and search for “reverse mortgages”. AARP is also a protagonist of this federally backed programme for seniors. www.aarp.com

Let's look at an illustration lawsuit scenario, with a client who desires to purchase long-term care insurance and life insurance.

Jane Ian Smith lives in St. Louis, Missouri.

• 65 old age old

• Owns a home worth $200,000

• Standard wellness rating

• 5 twelvemonth plan

• Compound rising prices protection

• 90 elimination period

• $150/day coverage- comprehensive

• Annual insurance premium sum of money for both to have got coverage: $4548

Jane is eligible to have a lump sum of $99,657.03, from the equity in her home. Jane will purchase a life insurance policy by paying a 1 clip insurance insurance premium of $50,000.

• Jane go forths the remaining $49,657.03 in a line of credit that turns at 6.35% per year.

• She pays her annual LTCi premium from the line of credit every year.

This agency that Jane will go forth her inheritors a death benefit of $222,736, plus the value of her home minus her loan balance. She will be protected from the ruinous cost of long-term care, and will be able to remain in her home to have got that care.

You have now helped her inheritors to have a tax free heritage that is deserving more than than the current value of her home.

Jane did all of this without touching a penny of her savings, investments, or current income. In fact, you handed her and her inheritors the cash flow they needed to maintain her safe for her remaining years.

Get educated.

If you desire to sell more than LTCi, my suggestion is to have got access to all of the tools you need to do that possible. Team up with person in your community who can compose rearward mortgages, or learn how you can compose them yourself! Below is a reappraisal of common myths and misconceptions about contrary mortgages in lawsuit you missed this column last month.

Common client myths and misconceptions about contrary mortgages

(a.k.a. Home Equity Conversion Mortgages):

The Lender will have my home. FALSE!

You, your household or estate go on to reserve ownership of your home. The Lender makes not take control of the title. The lender’s interest is only to the extent of the outstanding loan balance. As with a traditional mortgage they never have got ownership in the property.

The Lender cannot delay for me to “get out of my house” sol the lender can be repaid. FALSE!

The Department of Housing and Urban Development approved Lender(s) are not in the business of merchandising homes. However, with the support of Department of Housing and Urban Development they are in the business of helping seniors maintain their homes and being able to utilize some of their equity to ran into whatever financial needs they may have got – without causing additional financial troubles by requiring a mortgage payment.

My inheritors will be responsible for repayment of the loan. FALSE!

The Home Equity Conversion Mortgage is a Non-Recourse Loan, this agency that the lender can only retrieve repayment of the loan from the return of the sale of the property. If the property decreased in value and the loan amount was greater, the lender is paid the difference from the Department of Housing and Urban Development Mortgage Insurance. Your inheritors will not be responsible for the repayment of the loan

Home Equity Conversion Mortgages are very safe. TRUE!

FHA and FannieMae warrant the payments that are made to you (not applicable to CASH Account option).You go on to have your home and are guaranteed that you can remain in your home as long as you like, AND…You (the Borrower) are guaranteed that you can never owe more than than your house is worth. All of the above warrants are additional backed by the Department of Housing and Urban Development Mortgage Insurance on HECM’s.