Donald Trump should do a Reverse Mortgage
I believe Donald Trump should do a Reverse Mortgage. That’s right, Reverse Mortgages aren’t just for the impoverished retirees living paycheck to paycheck. With the evolution of Reverse Mortgages the current guidelines offer advantages and opportunities that fit nearly every situation, even those who have more money than they could spend in many life times.
I confess I’ve never done a Reverse Mortgage for a billionaire like Donald Trump but I have worked with multiple millionaires who see the power of a Reverse Mortgage as a way to grow and protect their money. Below I’ll give you some examples of why someone with ample financial resources would be drawn to doing a Reverse Mortgage.
For each of these examples let’s use an imaginary homeowner named Donald. Donald is 75 years old and has $300,000 to buy a new home in Utah but wants to own a home with no monthly mortgage payment. These are his options using a Reverse Mortgage.
Option 1: Free and Clear
Donald could find a $300,000 home and pay cash. Now he owns a home free and clear but he’s also tied up all of his liquid assets and although he can leave the home to his kids to sell for an inheritance he may end up financially tight the rest of his life.
Option 2: Asset Flexibility
With a Reverse Mortgage Donald could buy the same $300,000 home but only put down $110,000. He owns the same home with no payments but now he keeps $190,000 in the bank to allow him to live life the way he wants.
Option 3: Buying Power
Donald’s been a hard worker since he was a teenager. After 50-60 years in the workforce he may feel he deserves to live more luxuriously. By using the full $300,000 as a down payment he can purchase his dream home for as much as $690,000.
Option 4: Asset Growth and Protection:
If Donald feels option 1 is the best thing simply because he wants to leave the home for his kids then option 4 is a much better solution. With option 4 Donald brings in all $300,000 to buy a $300,000 home. But in this scenario he sets up a Reverse Mortgage Line of Credit for $190,000. Because this is a line of credit Donald can access the money when he needs it without having to make payments. If he never uses the money, he’s never charged interest. In addition, (and this is the big kicker) as long as he doesn’t use that $190,000 line of Credit it will grow at a rate equal to his interest rate and mortgage insurance rate, which on most loans is between 5.75% and 6.0%. So, with a growth rate of 6%, after 10 years Donald’s $190,000 will grow to roughly $340,000. After 20 years it will grow to $650,000.
No one who is 62 or older should own their primary residence free and clear without having a Reverse Mortgage Line of Credit. Think about it, you have an available source of liquid assets that are guaranteed by HUD/FHA and grows at a rate of roughly 6% year over year. If that money is never used then it can’t be charged interest. But if life happens and $50,000 is needed in a moment for things like cancer treatments, a knee replacement, college tuition for a grandchild, or a lavish trip around the world, the Line of credit is sitting there waiting to be used.
It is truly one of the cheapest and most sure ways to insure against the unknown and an opportunity every eligible homeowner should employ. This is why, I believe Donald Trump should do a Reverse Mortgage, because even with all of his money this is another way to protect and grow his assets.
If you or someone you love is considering a Reverse Mortgage, call me to discuss how this product could create a better life.
Reverse Mortgage Specialist
Heritage Reverse Mortgage
Heritage NMLS #1497455 Trevor’s NMLS #: 267962
1060 South Main Street 301B
St George Utah 84770