Comments on: Reverse mortgage has advantages, drawbacks http://reversemortgageloanblog.com/2009/08/11/reverse-mortgage-has-advantages-drawbacks/ News and discussion about Reverse Mortgages Sat, 30 Apr 2011 21:05:04 +0000 hourly 1 http://wordpress.org/?v=3.0.5 By: Peter http://reversemortgageloanblog.com/2009/08/11/reverse-mortgage-has-advantages-drawbacks/comment-page-1/#comment-3938 Peter Wed, 19 Aug 2009 22:44:03 +0000 http://reversemortgageloanblog.com/?p=844#comment-3938 Okay, here you go again...perpetuating another dangerously conveyed message. Why do you assume that the basis of traditional financial planning "thinking" is the correct ideology...especially relating to utilizing or not utilizing an asset that will never produce a rate of return (i.e. equity)? It seems this has become a path repeated by shepards and where all the sheep get herded. In fact, this prevailing mindset is more like a "koolaid" that has led to the loss of billions 9maybe trillions) in retirement savings of soooooo many seniors [and non-seniors]? How can any honest professional subscribe to a planning montra that has failed time after time to produce projected results...for MOST people. Even a weathermen [woman] have a better track record of accuracy. Most seniors who own their primary residence free and clear would typically like to ensure that their loved ones benefit from their lifetime of hard work, right? So why aren't they taught or educated of "opportunity cost" or the value of a dolar today versus 5, 10, 15 years from now? How about you agree to sell me your home for $200,000 but I don't have to pay you anything until 15 years from now? At that point I will pay you the full $200, 000. Sound like a good deal? Crazy right? So, why would you NOT suggest that seniors consider gifting TODAY in situations where they intend to gift to specific loved one. Imagine how much more the kids or grandkids might be able to grow that asset...over the next 5, 10, 15 years. Or, grandma and grandpa might consider purchasing a second (vacation) home to use for pleasure (them and kids), growth and income in the off season? When you factor in the "velocity" of money by tapping equity without a monthly repayment, you leverage wealth while potentially enjoying a more comfortable lifestyle. Sure, there are pitfalls, but there is no single financial product that fits everyones needs or wants. The fact is that home vales have fallen by nearly $6 trillion dollars since 2008, yet the higher cost of the reverse mortgage (in comparison to forward mortgages) can still be justified (mathmatically) and may be more so...if values continue to slide south. Then, the reverse mortgage program may serve to rescue more seniors from foreclosure. That could be a far better course, and less costly, than the consequence to our economy without the program. I'll stop reading and responding to your articles...but I hope that you will consider these comments as simply food for thought. I'm sure you had only good intentions. Okay, here you go again…perpetuating another dangerously conveyed message.

Why do you assume that the basis of traditional financial planning “thinking” is the correct ideology…especially relating to utilizing or not utilizing an asset that will never produce a rate of return (i.e. equity)? It seems this has become a path repeated by shepards and where all the sheep get herded. In fact, this prevailing mindset is more like a “koolaid” that has led to the loss of billions 9maybe trillions) in retirement savings of soooooo many seniors [and non-seniors]? How can any honest professional subscribe to a planning montra that has failed time after time to produce projected results…for MOST people. Even a weathermen [woman] have a better track record of accuracy.

Most seniors who own their primary residence free and clear would typically like to ensure that their loved ones benefit from their lifetime of hard work, right? So why aren’t they taught or educated of “opportunity cost” or the value of a dolar today versus 5, 10, 15 years from now?

How about you agree to sell me your home for $200,000 but I don’t have to pay you anything until 15 years from now? At that point I will pay you the full $200, 000. Sound like a good deal? Crazy right? So, why would you NOT suggest that seniors consider gifting TODAY in situations where they intend to gift to specific loved one. Imagine how much more the kids or grandkids might be able to grow that asset…over the next 5, 10, 15 years. Or, grandma and grandpa might consider purchasing a second (vacation) home to use for pleasure (them and kids), growth and income in the off season? When you factor in the “velocity” of money by tapping equity without a monthly repayment, you leverage wealth while potentially enjoying a more comfortable lifestyle. Sure, there are pitfalls, but there is no single financial product that fits everyones needs or wants.

The fact is that home vales have fallen by nearly $6 trillion dollars since 2008, yet the higher cost of the reverse mortgage (in comparison to forward mortgages) can still be justified (mathmatically) and may be more so…if values continue to slide south. Then, the reverse mortgage program may serve to rescue more seniors from foreclosure. That could be a far better course, and less costly, than the consequence to our economy without the program.

I’ll stop reading and responding to your articles…but I hope that you will consider these comments as simply food for thought. I’m sure you had only good intentions.

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