Borrower Satisfaction Surveys
Results from three surveys over the 20 years since the government-insured reverse mortgage program, known as the Home Equity Conversion Mortgage (HECM), was first authorized by Congress indicate borrowers are satisfied with their reverse mortgage. They report greater financial comfort and peace of mind.
According to a 2007 survey conducted by AARP, 93 percent of borrowers reported that the reverse mortgage had a positive impact on their lives. As one borrower summarized, “Why on earth aren’t more people telling seniors about this Federally Insured Reverse Mortgage?” In 2000, the U.S. Department of Housing and Urban Development (HUD) conducted a survey and found that participants’ levelof satisfaction with their reverse mortgage was high. This upholds a survey conducted in 1998 by the Federal National Mortgage Association (Fannie Mae) that reported 94 percent of borrowers were satisfied with their reverse mortgage decision.
“Without increased social security benefits, retirement funding will need to come from seniors’ own personal resources,” said Peter Bell, president of the National Reverse Mortgage Lenders Association (NRMLA). “In light of reduced stock and bond portfolios, seniors will have to consider other asset pools, including the use of home equity, to help fill this financial shortfall.”
A reverse mortgage enables homeowners 62 and older to borrow against their home with no required repayment for as long as they live in their home. A reverse mortgage does not affect Social Security or Medicare Benefits, and like other loans, proceeds received from a reverse mortgage loan are not taxed. These studies make it clear that satisfaction with the reverse mortgage has been consistent over the past 20 years; however, misconceptions continue to prevent senior adults who could benefit from a reverse mortgage from taking advantage of one.
Reverse mortgages continue to show significant growth as senior adults become better educated and attitudes change toward incorporating a reverse mortgage in retirement and long-term care planning.