San Francisco Chronicle - (Sunday)
Unconventional lifesaver: Reverse second mortgage saves family’s home
Mortgage broker: Scott Baer, California Mortgage Advisors.
Loan amount: $409,000.
Interest rate: 8.99%.
APR: 9.827%,
Backstory: The crisis began when an unexpected medical emergency drained their savings and they found themselves perilously close to losing their cherished family home. Traditional avenues like refinancing or taking out a regular second mortgage seemed impossible given their income and circumstances. It was at this juncture that their financial advisor suggested an unconventional yet potentially life-saving option — a reverse second mortgage — and suggested they contact me.
A reverse second mortgage is an innovative financial tool that allows homeowners to tap into the equity they’ve built up in their property, but with a twist. Instead of making monthly payments, like with a regular second mortgage, they could receive monthly payments from the lender. The best part? They could continue to live in their home as long as they wished, even without making mortgage payments on their second loan.
Of course, like any financial arrangement, there were drawbacks and considerations. Interest on the reverse second mortgage accrued over time, and it would eventually need to be repaid when they sold the home or no longer lived there. However, knowing that they could continue living in the home without the immediate threat of foreclosure was worth it.
The process of securing this unique financial instrument was surprisingly smooth. I took the time to explain all the details and implications, ensuring that they fully understood the agreement.
One of the most notable advantages of the reverse second mortgage was the flexibility it offered. They could use the funds as needed to cover medical bills, daily expenses, and even home improvements. It was like a lifeline that not only helped them keep their home but also improved their quality of life.
If you ever find yourself facing an unexpected financial crisis and are at risk of losing your home, I encourage you to explore all your options, including unconventional ones like a reverse second mortgage. It might just be the lifeline you need to secure your family’s future and preserve the place you call home.
Scott Baer, California Mortgage Advisors, 415-451-4110, sbaer@calmtg.com.