Top 5 Reasons Why Getting a Reverse Mortgage is a GOOD Idea

No one ever said that life is easy, fair, or even that it comes cheap. In fact, the cost of living has been incrementally increasing over the years making it that much harder for individuals to afford even the basic necessities.

But if you are a homeowner where a lot of your accumulated wealth over the years has gone into increasing your home equity, a reverse mortgage just might be one of the best solutions to life’s problems.

While many financial experts don’t like to suggest using reverse mortgage as a credible financial tool, the truth is that many homeowners have found obtaining a reverse mortgage to be a useful way to fund retirement, pay medical bills, and improve their quality of life.

If you have ever considered getting a reverse mortgage but have been unsure if the benefits outweigh the drawbacks, here are 5 reasons why getting a reverse mortgage is a good idea.

Enjoy Your Retirement

Whether you are relocating to somewhere tropical or simply relaxing out on your back porch, retirement can still be an expensive pill to swallow.

Life doesn’t just stop because you retire, but many people do experience a reduction in income. As a result, many homeowners find it difficult to balance their budget when transitioning to a fixed income.

Research also shows that nearly 35% of Americans have no money set aside for retirement ¹ . If you haven’t properly saved for retirement or if you cash it tied up in your home, a reverse mortgage might be the solution for you.

A reverse mortgage can help you fund your retirement in style by providing you a supplemental stream of income to help you balance your budget and pay your monthly expenses.

The IRS has also determined that funds received from a reverse mortgage are not taxable, because they are considered loan proceeds rather than income ² .

Get Paid Your Way

Reverse mortgages can be set up in a variety of different ways, meaning they can be extremely flexible. This also means you can set up the payments to best suit your needs.

For example, if you are someone who knows they will blow through a lump sum of money pretty quickly, you may want to consider choosing monthly advances.

On the other hand, if a portion of the funds has already been earmarked to consolidate debt or complete home improvements, taking a lump sum may be beneficial.

The bottom line is that a reverse mortgage can be customized to help you achieve your financial goals. Furthermore, the funds can be used for practically anything. There are no restrictions on how you use the funds.

Consolidate Debt

Contrary to popular belief, your home does not need to be free and clear to qualify for a new reverse mortgage. Many homeowners elect to obtain a reverse mortgage as a way to pay off an existing forward mortgage.

By paying off your existing home loan, you free up money in your budget because you no longer have a monthly housing payment. But a reverse mortgage is not just limited to paying off your current mortgage.

Paying off other debt including high interest credit cards, personal loans, and installment loans can also help reduce your monthly expenses and make living much more affordable.

Pay Medical Bills

Things in life can come up unexpectedly, throwing a wrench into your overarching financial plan. Specifically, healthcare related expenses can really eat into your savings and impact your household budget.

According to the American Medical Association, health spending in the United States grew by over 4% in 2019 which has been about the trend for the last few consecutive years ³ . As medical costs increase, it can make it harder to pay medical costs out of pocket.

Many borrowers that suffer from major or ongoing medical expenses choose to pay off those balances by using a reverse mortgage. Not only can you eliminate your balances, but a reverse mortgage will actually provide you with income to help combat future costs.

Protection Against Market Fluctuations

It may seem a bit absurd, but a reverse mortgage can be a blessing if real estate markets experience a correction or downturn. That is because reverse mortgages are a type of non-recourse financing ⁴ .

Unlike a traditional mortgage where your payment goes down over time, with a reverse mortgage your balance grows over time. This means that depending on how the market is doing, it’s plausible that your loan balance could exceed what your home is truly worth.

In this circumstance, a creditor cannot come after your personal assets (or your heirs’ assets) to repay the debt. This can provide you with peace of mind knowing you are okay despite what the market may or may not do.

Sources

1 Backman, M. (2020, February 19). You’ll Be Shocked by How Many Americans Have No Retirement Savings at All. Retrieved May 11, 2021, from https://www.fool.com/retirement/2020/02/19/youll-be-shocked-by-how-many-americans-have-no-ret.aspx#:~:text=Unfortunately, a large number of,survey released in January 2020.

2 Internal Revenue Service. (2021, January 04). Reverse Mortgages. Retrieved May 11, 2021, from https://www.irs.gov/faqs/other/for-senior-taxpayers/for-senior-taxpayers#:~:text=No, reverse mortgage payments aren,to live in your home.

3 American Medical Association. (n.d.). Trends in health care spending. Retrieved May 11, 2021, from https://www.ama-assn.org/about/research/trends-health-care-spending

4 Miller, P. G. (2021, February 03). Reverse Mortgage Pros And Cons. Retrieved May 11, 2021, from https://www.bankrate.com/mortgages/reverse-mortgage-pros-and-cons/

The post Top 5 Reasons Why Getting a Reverse Mortgage is a GOOD Idea appeared first on Fresh Home Loan.

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Garrick Werdmuller

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garrick@freshhomeloan.com

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From Garage to ADU: How a 203(k) Loan Helped One Family Maximize Their Space

By Garrick Werdmuller • June 18, 2025

🛠️ From Garage to ADU: How a 203(k) Loan Helped One Family Maximize Their Space 🛠️ Buy It and Fix It With One Loan: The FHA 203(k) Limited A few years ago, I helped a couple purchase their home with just 5% down. It was a great fit for them at the time — solid neighborhood, the space they needed, and a bonus: a detached garage with potential. Fast forward to today — their teenage son was getting older and needed his own space. Naturally, they started exploring how to turn that detached garage into an Accessory Dwelling Unit (ADU) so he could move in and have a bit more independence. They gave me a call, hoping to tap into their home’s equity with a line of credit. But after running the numbers, it became clear that a traditional HELOC wouldn’t provide enough funds to cover the full conversion. That’s when I brought up a lesser-known option: the FHA 203(k) Limited loan . The FHA 203(k) Limited program snapshot outlines a renovation loan product allowing borrowers to finance both the purchase and rehabilitation of a property with a single mortgage , specifically for non-structural repairs or improvements. Here's a summarized overview for reference or communication: 🏡 What Is It? The FHA 203(k) Limited is designed for: Homebuyers purchasing a fixer-upper Homeowners refinancing and remodeling Primary residences only You can finance both the home and non-structural renovations—like kitchens, bathrooms, floors, HVAC systems, roofs, appliances, and more—with a single mortgage . 💡 Why Use a 203(k) Limited? ✅ Finance up to $75,000 in repairs and upgrades ✅ Only 3.5% down payment ✅ One loan, one closing ✅ No 203(k) Consultant required ✅ Ideal for non-structural repairs and cosmetic improvements ✅ Perfect for first-time buyers and FHA borrowers 🛑 What You Can’t Do With It This is for light remodeling only. You can’t use this loan for: Structural changes or additions Foundation work Landscaping (except for erosion prevention) Pools, hot tubs, or other luxury features (Bummer ! I know! 😒) 🧾 Borrower Submission Checklist Here’s what we’ll need to get started on your FHA 203(k) Limited loan: ✅ Basic Docs Loan Application (apply online or schedule an appointment) Government-issued ID Most recent 30 days of paystubs Last 2 years of W-2s or tax returns (for self-employed borrowers) Most recent 2 months of bank statements ✅ Property & Repair Info Signed Purchase Contract (if purchasing) Contractor’s Written Proposal with: Itemized list of repairs Cost breakdown (labor + materials) Statement that work is non-structural W-9 form from contractor Contractor license & insurance (if required by local jurisdiction) ✅ Appraisal & Renovation Docs Appraisal supporting As-Is and After-Improved Value Permit list (if applicable) Final Work Plan (signed off before close) 💬 Final Thoughts The FHA 203(k) Limited can turn a fixer into your dream home—or give your current space the refresh it deserves. With just one loan , you get flexibility , affordability , and peace of mind . Have a property in mind? Let's talk! 👉 Schedule a Free Consultation https://freshhomeloan.com/schedule-a-meeting/ 🏡 #FHA203k #203KLoan #RenovationLoan #FixerUpper #HomeRemodel #MortgageSolutions #FirstTimeHomeBuyer #HomeLoanHelp #RealEstateTips #MortgageBrokerLife #CaliforniaHomes #BayAreaRealEstate #CentralValleyHomes #DreamHomeGoals

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Guía definitiva de préstamos ITIN – Tu paso hacia la compra de casa

By Smith Chung • June 18, 2025

¿Qué es un préstamo ITIN? Un préstamo ITIN es una hipoteca diseñada para personas que declaran impuestos usando un Número de Identificación de Contribuyente Individual (ITIN) en lugar de un número de Seguro Social (SSN). El ITIN lo otorga el IRS a quienes no son elegibles para un SSN pero aún así deben declarar impuestos en EE. UU. 💬 En resumen: ¿No tienes SSN? ¡No hay problema! Si has sido financieramente responsable y cuentas con documentación básica, ¡podrías calificar! 💪 👨‍👩‍👧‍👦 ¿Quién se beneficia de un préstamo ITIN? Los préstamos ITIN están diseñados para quienes persiguen el sueño americano — incluso sin documentación tradicional. Podrías beneficiarte si: 🌎 Eres inmigrante viviendo en EE. UU. sin green card ni SSN 🧾 Declaras impuestos usando un ITIN 💼 Tienes ingresos estables (W-2, por cuenta propia o incluso en efectivo con comprobantes) 💳 Pagas renta y servicios a tiempo y puedes demostrarlo 💥 Hemos ayudado a familias que pensaban que comprar casa era imposible — ¡y cerraron en solo 30–45 días! 🛠️ ¿Cómo funcionan los préstamos ITIN? Los préstamos ITIN generalmente son financiados por prestamistas no tradicionales (non-QM) o bancos especializados que operan fuera de los lineamientos de Fannie Mae/Freddie Mac. Aquí te explicamos cómo funcionan: 💰 Tipos de préstamo: Tasa fija o ajustable Compra, refinanciamiento o retiro de efectivo Propiedad principal, segunda vivienda y algunas propiedades de inversión 💵 Pago inicial: Generalmente del 10 % al 20 % A menudo se permiten fondos de regalo 📊 Crédito: En algunos casos no se requiere puntaje FICO Se puede usar historial de renta, servicios públicos o incluso crédito internacional 📉 Tasas y plazos: Ligeramente más altas que las convencionales Disponibles con tasa fija a 30 años o ARM de 5/7/10 años 📄 Documentación que necesitarás Para obtener una precalificación, debes demostrar estabilidad, ingresos y solvencia. La mayoría de los prestamistas solicitarán: 🆔 ITIN válido y vigente 📑 2 años de declaraciones de impuestos 💼 Comprobante de ingresos (W-2s, 1099s, o P&L si trabajas por cuenta propia) 🏦 2–3 meses de estados de cuenta bancarios 🌐 Identificación válida (pasaporte, matrícula consular, etc.) 🏘️ Historial de renta (comprobante bancario o carta del arrendador) 💡 Consejo extra: ¡Algunos prestamistas incluso aceptan ingresos o activos del extranjero! 🚫 Conceptos erróneos comunes sobre los préstamos ITIN ❌ Mito 1 : Los préstamos ITIN son ilegales. ✅ Falso. Son 100 % legales y cumplen con las regulaciones federales. ❌ Mito 2 : No calificas si eres trabajador independiente o te pagan en efectivo. ✅ No es cierto. Con declaraciones de impuestos o registros bancarios, definitivamente puedes calificar. ❌ Mito 3 : Te van a estafar o cobrar de más. ✅ ¡No con nosotros! Buscamos la mejor opción para tu préstamo y te explicamos todo con claridad. 🌱 ¿Por qué los préstamos ITIN son importantes para nuestras comunidades? 🏘️ Ser dueño de una casa crea riqueza generacional, estabiliza vecindarios y eleva a las familias. Para muchos inmigrantes, los préstamos ITIN son un puente hacia un futuro mejor — y nos enorgullece ser parte de ese proceso. ❤️ 🧑‍💼 Cómo pueden ayudar los agentes de bienes raíces Agentes inmobiliarios — ¡no dejen pasar esta oportunidad! Los compradores con ITIN son leales, motivados y, en muchos casos, están bien establecidos en sus comunidades. Aquí algunas formas de atenderlos mejor: 🤝 Haz equipo con prestamistas que conozcan las reglas de ITIN • 📆 Establece tiempos y expectativas realistas • 💗 Lidera con empatía y orientación 📣 ¿Quieres destacar? Dirige tu marketing a clientes con ITIN — ¡nosotros te respaldamos! 💼 El enfoque de Fresh Home Loan hacia los préstamos ITIN En Fresh Home Loan Inc., trabajamos con prestamistas confiables para ofrecer soluciones hipotecarias ITIN rápidas, justas y transparentes. Ya sea tu primera casa o una inversión, estamos contigo en cada paso. ✅ 🚀 ¿Listo para comenzar? ¿Conoces a alguien que pueda beneficiarse de un préstamo ITIN? Hagamos realidad el sueño de ser dueño de una casa — de la forma correcta, con apoyo y claridad desde el primer día. 🏠✨ “Llama hoy mismo para empezar tu precalificación — en Fresh Home Loan hablamos tu idioma y creemos en tu futuro.”