Yes, you read that right! It may sound counterintuitive, but now could be the perfect time to exchange your low-interest conventional mortgage for a higher-interest-rate reverse mortgage.

Why would you make that switch? The straightforward answer is that you can actually build equity faster by making payments on a reverse mortgage than on a traditional 30-year fixed mortgage.

How Does That Work?

With a reverse mortgage, monthly payments are not required, but there are strategic advantages to making them—especially in today’s high-interest rate environment.

Consider a homeowner over 62 who has a $1,500 monthly principal and interest (P&I) payment on their 30-year fixed mortgage. In the first decade of that loan, very little of their payment goes toward building equity. In fact, based on a standard amortization schedule, it takes more than 15 years before even half of a P&I payment contributes to equity!

Now, imagine applying that same $1,500 monthly payment toward a reverse mortgage. Unlike a conventional mortgage, where much of the early payments go toward interest, 100% of that $1,500 would go directly toward increasing your available equity. Even better? The equity you unlock is growing at an annual rate (currently over 7%), compounded monthly.

The Reverse Mortgage Advantage

The FHA Home Equity Conversion Mortgage (HECM) program has been around since the 1980s, and it has evolved significantly. Over the past 40 years, legislative improvements have strengthened homeowner protections while making it easier to access and grow home equity over time.

If you’re looking for a way to enhance your financial future with more tax-free income options, now is the time to explore how a reverse mortgage could work for you.

Learn More at Our Next Reverse Mortgage Lunch & Learn

I regularly host educational presentations on reverse mortgages to help homeowners, financial advisors, CPAs, estate planners, and fiduciaries understand how this tool can serve as a powerful part of a retirement strategy.

Join us for our next Reverse Mortgage Lunch & Learn on April 22nd at The Circle of Life Resource Center. We’ll bust common myths, dive into the details, and show you how a reverse mortgage can function as an investment account similar to your other retirement assets.
https://www.arizonareversemortgages.net/events/

Ready to take the next step? Don’t wait—learn how you can make your home equity work for you today!