Mindy’s official credit rating was “dog water”. She was behind on everything but needed some help to pay off debt.
The Scenario:
Mindy was behind on everything. She owed the IRS $20,000. Her mortgage was rolling 30-day lates for the past 12 months. She had a lot of equity in her home, but her credit was shot and her credit score was 515.
She had a solid retirement income with $9,000/mo, but was just so far behind on everything that she was not going to be able to dig out.
Luckily, she was in her mid 60’s and could get a reverse mortgage. Her payment history might have been a dealbreaker under normal circumstances, but there was enough equity in her home to payoff the mortgage, the IRS, and the mandatory LESA account (lifetime escrow set aside) so she’d never need to worry about property taxes and insurance again.
Her other bills didn’t get paid off, but now she could apply the $9,000/mo retirement income towards her other debt.
*Note, it took some education for her to understand that a reverse mortgage is just a loan like any other loan EXCEPT that payments are not required. When she passes away, the loan is paid off from her estate like any other loan would be. Not only that, but she can make payments if she wants to.
Why this might matter
Lots of seniors get behind on bills but have equity in their homes. The “lifestyle mortgage” (aka reverse mortgage) is a godsend for many.
We all hate to tell a client “no, sorry we can’t help,” and this option is often the only way to get to a “yes” when they need help.
Work with me
Do you have a deal that you think might be approvable but doesn’t fit in the box at your bank or credit union? Reply to this email or call/text me at 616.298.2743 for a same-day answer.
One case study per week showing scenarios we’ve been able to help with