AN INSIDER'S GUIDE TO REVERSE MORTGAGES

Parker, a reverse mortgage and financial planner, presents a guide to understanding and using reverse mortgages.

The author explains that a reverse mortgage is a “cash loan from a bank, using your primary residence as collateral.” Unlike a traditional mortgage, in which the borrower makes monthly payments on a loan, in a reverse mortgage the loan is usually not repaid until the last living borrower leaves their home. Reverse mortgages come with restrictions: The home that is being used as collateral for the loan must be the borrower’s primary residence, and most states require the borrower to be 62 years of age or older (the benefits are designed for those at or nearing retirement age). Later portions of the book explain how a reverse mortgage can be used as part of a retirement strategy Parker calls “full balance sheet financial planning.” He includes the caveat that many people are misinformed about this financial product, pointing out that, “as with anything that has to do with money, scams exist.” Why, though, do people often express such disdain when the subject of reverse mortgages comes up? A brief history of the practice helps to explain some of the negative connotations. The author presents reverse mortgages in a positive light, and the book effectively guides the reader through the intricacies of these loans, clearly outlining the requirements for qualifying and the steps (the author identifies seven) to actually obtain one. The process can be tedious; the steps laid out by Parker, concluding with “Closing and Payout Election,” require a lot of time, expert guidance, and copious amounts of paperwork. While this may not make for the most exciting reading, it stands up as a sensible examination of a complex subject. The book is a concise starting point for any homeowner considering such a financial undertaking.

An informative, sober look at an often-misunderstood retirement tool.