Reverse Mortgage and Tom Selleck: What is the Truth?
You have probably seen the commercials by now where Tom Selleck talks about Reverse Mortgages. If you have seen them you probably would agree that he has such a great presence behind the camera.
No matter what he is saying, he can be very convincing. In one spot of the commercial he is in an impressive city apartment. The ad starts with dramatic music and Selleck sounds convincing. He then turns around on the spot and offers a friendly explanation of reverse mortgages and how people typically use them.
How accurate do you think the advertisement is? Is he telling the truth about reverse mortgages? Let’s see:
Selleck claims: The Bank does not get your House when you have a Reverse Mortgage.
This is a true statement. You are not selling your home to anyone. You are the only person on the title of the home. You retain all ownership – this is a fact.
You are getting a loan when you are getting a Reverse Mortgage. The bank is lending you money in a similar way as they do when you are getting a regular home equity loan. When you pass away, the home is still yours to pass onto your heirs.
Selleck admits that: Reverse Mortgages Are Not Too Good to Be True
We don’t need to tell you that there are pros and cons to all financial decisions that you make in life. You know that. Research shows us that reverse mortgage borrowers are really happy that they secured their loan.
Research has found that:
- Borrowers feel that a reverse mortgage has truly given them peace of mind during a stressful time
- They feel that it improved their overall quality of life
- They comment that they have a much more comfortable lifestyle with the loan
Clearly borrowers feel that reverse mortgages are not too good to be true. They find them beneficial and they find that they help to improve their quality of life. So overall, people who have them like them and definitely find them to be beneficial.
Selleck states: A Reverse Mortgage Loan is a Simple Idea
This is a point where some people might diagree. A reverse mortgage loan is like a mortgage – yes. In fact, it is actually the reverse. The loan amount grows because you are accumulating interest. This aspect is a bit confusing to understand for some people.
Another confussing point is around how you access your loan amount and the fact that you do not always have full access to that money.
In addition, the fact that you will never owe more than the value of your home by the time the loan becomes payable, no matter how much money you have borrowed – is indeed another confusing concept.
There are many benefits of the loan, however, as you can see the concepts can be a bit confusing to some. That is why it is important for anyone considering getting a reverse mortgage to have a session with a reverse mortgage counsellor.
After you have selected a lender, you can meet with the counsellor. This session is specifically designed to make sure that borrowers fully understand all of the details of reverse mortgages.
As you can see, reverse mortgages are not easy to understand for everyone, but have great benefits and definitely worth investigating further, like so many Americans have already done.
Selleck states in the commercial: A Reverse Mortgage Turns Your Home Equity into Cash That You Pay Off When You Leave the House
This statement is misleading. It is not incorrect, but it is not 100% accurate. Have we lost you yet? Hang on.. here is the explanation.
It is correct that the loan turns your home equity into cash. However, the amount that you can access varies depending upon a number of specific variables.
Some people think that with reverse mortgages, you have access to all of the money at once, or you can borrow the full value of your home. This is simply not the case. You are only allowed to borrow a portion of your home equity.
Now here is where it gets interesting.
It is important to note that you do not always get your full loan amount in cash.
Your reverse mortgage loan once approved, must first be used to pay off any balance of your traditional mortgage. If you have one, that is.
The remaining money can now be accessed in cash, in the form of a line of credit, or via monthly instalments.
The Loans Are Used to Pay Off your Mortgage balance, Pay your Bills, Pay Medical Bills and Make Updates to Your Home: Selleck claims
These are definitely the most popular ways that people use money from reverse mortgages.
If you have an existing mortgage, getting a reverse mortgage to pay off the balance of your conventional mortgage can have a positive impact on your monthly cash flow and quality of life – there is no question about that.
Selleck claims in the commercial: Reverse Mortgages Give Stability In Retirement
As you can imagine, the reverse mortgage industry is heavily regulated. These loans are specifically designed to give seniors retirement stability. Over time the government has constantly refined the program to protect the senior homeowners.
If you are considering getting a reverse mortgage, you must undergo a counselling session as well as a financial assessment to determine whether or not the reverse mortgage loan is a good fit for you.
So, Selleck is right here again.
How Truthful is Selleck on Reverse Mortgages, in the tom selleck reverse mortgage commercial?
Very truthful.
The TV commercials do a great job in introducing the reverse mortgage concept.
The decision to obtain the loan can be complicated and a bit confusing. However, most Americans that have got a reverse mortgage find that the loans have really helped to improve their quality of life.
If you are interested in reverse mortgages, and want to know more, we recommend you take a look at this no obligation reverse mortgage calculator.