The Consumer Financial Protection Bureau today published a report evaluating the financial impact of using HECM loan proceeds to bridge the gap in income while delaying Social Security benefits until a later age. The CFPB also released a new video and guide explaining reverse mortgages to consumers.
“For consumers whose main asset is their home, taking out a reverse mortgage to delay Social Security claiming may risk their financial security because the cost of the loan will likely be more than the benefit they gain,” said CFPB Director Richard Cordray in a press release promoting the CFPB’s analysis, Issue Brief: The costs and risks of using a reverse mortgage to delay collecting Social Security.
After reviewing the findings, NRMLA commented:
“Taking a reverse mortgage, or any financial product, is a much more complex decision than the CFPB’s narrow account of one Social Security claiming strategy makes it out to be. We will continue to support research and analysis of the value of using home equity to bridge the income gap created when Social Security claiming is delayed until Full Retirement Age or age 70.
“We always encourage consumers to consider any financial decision as part of their comprehensive retirement financial plan and to seek guidance from qualified individuals who are familiar with their personal situation. To help educate more people about their financial options, NRMLA posts free guides and resources to our consumer website www.reversemortgage.org, including An Introduction to Housing Wealth and the Reverse Mortgage Self-Evaluation: A Checklist of Key Considerations.”