 Karen Ledwith, 78, lives in Palo Alto, California, in a house she’s owned since 1984. She’s widowed – a retired marriage counselor – and loves to cook and garden. She managed to get by on a monthly income of just $2,600, including Social Security and her pension. She has a housemate, who assists with the expenses. Her home, recently appraised at $1.1 million, has a $170,000 adjustable-rate mortgage. As interest rates have risen, so have her monthly payments, and a change in her payment structure was unaffordable. In addition, she’d like to help her oldest grandchild pay for medical school.
A reverse mortgage was the answer. She had been considering a reverse mortgage for some time, to relieve the financial stress she was under. After sitting down at her kitchen table and talking it through, she was able to see the benefits. Karen borrowed $462,000, minus the payoff on her mortgage. She could sell or refinance the house at any time, and also retains title to the property as long as she lives in it. With the funds from the reverse mortgage, Karen was able to get her house painted, inside and out, update the plumbing, fix the fireplace – and help her grandson become a doctor. |
ReverseChoices@MaryJoLafaye.com
