If you’re approaching retirement or already enjoying it, you might have heard more talk lately about reverse mortgages. You’re not alone in your curiosity – a recent study by Seniors First found that inquiries about reverse mortgages have jumped by 300% in just two years.
The idea may appeal – tap into the equity you’ve built up in your home without having to sell it. However, the process can be confusing, often leading to costly mistakes.
Why Is It So Complicated?
The short answer? There are too many options and not enough clear information. Seniors First looked at Australia’s top four reverse mortgage providers and found over 150 different variables. That’s a lot to wrap your head around!
Many of the rules and eligibility requirements aren’t publicly available, which makes it even harder to figure out on your own.
The reverse mortgage market is more complex than ever. This complexity can be overwhelming for many over-60s who are simply trying to access the equity in their homes, without making a costly mistake.
Every Situation Is Different
There’s no “one-size-fits-all” reverse mortgage. What works for your next-door neighbour might not be right for you. Your age, home’s value and location, financial goals, and family situation all play a role in determining the best option.
Getting the Right Help
The good news? You don’t have to navigate this alone. Two types of professionals can make this process much more transparent and safer for you.
Mortgage Brokers who specialise in reverse mortgages understand the “hidden” components. A good broker will:
- Compare options from multiple lenders
- Explain the differences in plain English
- Help you understand the true costs and long term implications
- Find features that match your specific needs
Financial Planners can help you see the bigger picture. We can look at your overall retirement strategy and help you understand:
- Whether a reverse mortgage fits your long-term goals
- How it might affect your pension or other government benefits
- What alternatives might work better for your situation
- How to structure your finances to best suit your needs
The purpose of this website is to provide general information only and the contents of this website do not purport to provide personal financial advice. Financial Horizons (Cairns) Pty Ltd strongly recommends that investors consult a financial adviser prior to making any investment decision. The contents of this website does not take into account the investment objectives, financial situation or particular needs of any person and should not be used as the basis for making any financial or other decisions. The information is selective and may not be complete or accurate for your particular purposes and should not be construed as a recommendation to invest in any particular product, investment or security. The information provided on this website is given in good faith and is believed to be accurate at the time of compilation.