Martin Seay, Ph.D., CFP®, assistant professor of personal financial planning, and Elizabeth Kiss, Ph.D., assistant professor and Extension specialist in family resource management, collaborated on a fact sheet and teaching guide about reverse mortgages to help consumers understand the three ways to get cash from their home; understand the difference between forward mortgages, reverse mortgages and home equity loans; know what factors to consider when evaluating a reverse mortgage; and become familiar with the product features, eligibility requirements, costs, available loan amounts and borrower obligations of the Home Equity Conversion Mortgage (HECM), the most common reverse mortgage product.
In a 2012 analysis, the Consumer Financial Protection Bureau found that 46 percent of new reverse mortgage borrowers in fiscal year 2011 were under age 70. Younger borrowers are able to borrow less than older borrowers. Younger borrowers also risk being unable to finance a future move because the reverse mortgage must be repaid when the house is sold.
Both resources are available free of charge online from the K-State Research and Extension bookstore. The fact sheet is available online, as is the teaching guide, which includes suggested workshop activities, community activities and an evaluation.
K-State Research and Extension provides education to help people, businesses and communities solve problems, develop skills and build a better future. Local extension offices are partners with local county government, Kansas State University and the U.S. Department of Agriculture. Extension offices in every county in Kansas provide a direct link to land-grant university information.