Juliette Taylor No Comments

Loan Scenario – Meeting needs for quality aged care plus renovations and maintenance.

Michelle (aged 65) lives in her home in the Northern Beaches. Her husband Anthony (aged 71) lives in an Aged Care centre specialising in the care of people with Alzheimer’s and dementia. He has been in Aged Care for over 5 years after developing early onset dementia. Michelle is Anthony’s Power of Attorney. Michelle and her husband had a very successful business on the North Shore that was adversely affected by Anthony’s dementia, and then Covid-19. She had to close the business as it could not be sold.

They have a Reverse Mortgage over the property in the Northern Beaches for $410,000. This was taken out to assist in paying the Refundable Accommodation Deposit (RAD) for Anthony’s aged care facility. The $350,000 RAD will be refunded to Anthony‘s estate when he dies. 

Michelle wants to refinance the current Reverse Mortgage as there is a substantial difference in the interest rates (0.82% per annum) and she will get a rapid payback (well under 12 months) by changing to the new lender.

They both receive the aged care pension. But they receive the single aged pension as they are separated because of medical issues. The majority of Anthony’s pension is used to pay aged care costs (85% of the pension).

As her property is so valuable, she wants to use some of the equity to maintain and do renovations to suit her lifestyle. So on top of the $410,000 she is taking an additional $350,000.

This Reverse Mortgage has allowed Michelle to organise quality care for her husband in an extremely difficult time, without having to sell her house and sacrifice on her lifestyle.

BR No Comments

Loan Scenario of the Week (22/09/2023)

Eric (aged 77) and Donna (aged 76) have lived in their property on Sydney’s North Shore for 43 years. They wish to continue living there for as long as possible. Eric plays golf several times a week. They have a very active social life. They wish this to continue.

 

They have a Reverse Mortgage of approximately $1,130,000.00. Their property is valued at $4,500,000 and they wish to increase the limit of their Reverse Mortgage. Due to the various lenders in the market it is far cheaper to refinance with a different lender than just do an increase with their current lender.

 

The new Reverse Mortgage will be used to refinance (approximately $1,100,000) and then they wish to receive $4,000 per month for the next 5 years ($240,000). They would like to have an available credit line on top of this of $100,000 for unexpected costs or unplanned expenses, or to continue the monthly payment after the initial 5 years.

 

Eric and Donna have one surviving son, he is in a strong financial position and so is not reliant on receiving an inheritance. He is aware of the Reverse Mortgage and that they are looking to refinance. Due to the value of the property it is more than likely their son will still receive a large inheritance.

 

The property is of a high value and well positioned. Even with this larger than usual Reverse Mortgage the borrowers will have a lot of equity to pay for aged care costs if necessary in the future.

 

This loan has allowed Eric and Donna to continue their retirement and enjoy their retirement instead of enduring it.

 

If you would like to know more about how a Reverse Mortgage can help you achieve your lifestyle aspirations please call Raymond on 0438 184 784 or Nicholas on 0438 184 785.

 

(Names, locations, amounts, & other personal details have been changed to protect the client’s identity.)