Why Financial Advisers Must Discuss Reverse Mortgage With Their Clients

When people require reverse mortgage information, their best option is company websites. Most of the websites of lenders aim to answer all the questions about reverse mortgage so that senior homeowners can make an informed decision. There are also blogs with the objective of dispelling all the negative impressions among uniformed individuals.

Many professionals in the financial planning industry overlook the importance of home equity loans and reverse mortgage. If they want to serve according to the best interests of their clients, they have to explain the benefits that can be gained from reverse mortgage during discussions on retirement income planning.

For many individuals, the home is their biggest asset. It could also be the largest cash flow item for a retiree through the reverse mortgage. It is not reasonable for financial advisers to ignore reverse mortgage when establishing a financial plan. The error of omission can put the client in a worse financial situation.

Financial planners can be well informed about reverse mortgage if they will make the effort to read the research findings of Dr. Wade Pfau of the American College of Financial Services and Dr. Barry Sacks of HECM Advisory Group that explain the advantages of including reverse mortgage in retirement planning. Financial Industry Regulatory Authority Inc (FINRA) has also stated that reverse mortgage is an important planning tool that must be discussed by financial advisers with their clients.

Not long ago, financial advisers vowed that they will not sell long-term care insurance to their clients because many of the policies offer weak protection against inflation and high premiums. Lawyers questioned the financial advisers why they are ignoring the big risks of not having enough funds for long term care. A financial adviser who is committed to the best interests of the client must explore the potential benefits of reverse mortgage.

It is important for financial advisers to educate themselves with reverse mortgage information so that they will be better equipped to discuss the financial tool with their clients. They have to answer all the questions the client may ask about reverse mortgage and home equity loans and whether these financial planning tools can meet their retirement goals.

By Nikki Sanderson Posted in Business