CONTINUING MORTGAGE OR DEBT PAYMENTS 5/7

As most pre-retirees plan for a future with a reduced and fixed income, those who are homeowners face the harsh reality where, just because they retire, does not mean their mortgage or debt will go away. Sadly, they will have to find a way to continue to pay higher mortgages on an even more limited income.

With the fluctuating housing markets, the equity in their homes rises and falls every couple of years. Many homeowners have borrowed against the equity in their home for any number of reasons including vacations, home or auto repairs, medical expenses or to supplement their monthly income, just to name a few.

Some turn to newer financial vehicles to prevent defaulting on their home loans. Reverse mortgages are one such method which provides greater financial security for seniors who have been allowed by the U.S. Department of Housing and Urban Development.

Rather than paying their loan payment every month, qualified homeowners are allowed to convert a portion of the equity in the home to cash and halt payments on the loan until such a time where the home is no longer used as a primary residence or they fail to meet the obligations of the mortgage.

Ongoing debt from sources such as credit cards, medical expenses or financially assisting adult children can play a hefty role in increasing stress levels of pre-retirees and those already in retirement. Applying for consolidation loans, reduced monthly payments and using home equity to pay off other debt are all valid methods or addressing ongoing debt.

Working with a professional financial advisor to plan for and pay off ongoing debt can alleviate much of the unnecessary stress experienced by older adults. Understanding how variable interest rates, fees, and payment timetables can be adjusted and used to benefit the pre-retiree is just one way a financial advisor can work within the scope of an individual’s situation to provide relief they did not believe possible.

https://www.bestliferates.org/seniors/most-stressful-financial-concerns/
http://www.wunrn.com