Couple taps into home equity for upgrades with mortgage

Loan officer: Dominique Stevens, Mayfair Mortgage. Property type: Singlefamily home in St. Helena.

Loan type: Jumbo reverse mortgage.

Loan amount: $805,000. Rate: 6.99%.

Backstory: A St. Helena couple reached out to us in 2014 after researching reverse mortgages. They had wanted to use the reverse mortgage to extinguish their current mortgage and get some cash out to pay off the medical debt and have some reserves. With the reverse mortgage, we were able to do all that — eliminate mortgage payments for the rest of their lives and give them a significant cash infusion to pay off their debts.

As we kept in touch over the years, the homeowners were astonished to see how much their house had appreciated. In just six years, the house had gone up in value by more than $1 million.

In this case, they wanted to tap into the equity again to do repairs and upgrades on the home. They figured they needed about $75,000. Our calculations found that by refinancing their current reverse mortgage,

City

San Francisco

Belmont San Francisco

that they were eligible to receive more than $110,000 at closing.

With the new, jumbo reverse mortgage, our couple were able to do the home upgrades they wanted, and to have additional rainyday funds set aside. All while maintaining a balance of equity to leave their heirs.

A reverse mortgage allows adults 62 years of age and older to halt mortgage payments

Conventional 30-year fixed (%)

3.375 3.125 3.250

forever. The program requires that the home be their primary residence, and that the homeowner stay current on property taxes and hazard insurance. As nontaxable income, it does not affect Medicare, Social Security or pensions. Whatever equity is left after the reverse loan is paid off, goes to their heirs. Dominique Stevens, Mayfair

Mortgage, 4152508908, dstevens@mayfairmtg.com.

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