The financial landscape has shifted dramatically in the past few years, and if you’re an older homeowner yourself, you may be feeling the pressure. Rising inflation, increased healthcare costs, and economic uncertainty have many seniors thinking carefully about how to maintain their quality of life while protecting their savings.
Fortunately, you may already have a powerful financial resource at your fingertips—or rather, right under your feet—your home equity! Senior homeowners now hold record amounts of housing wealth, representing a tremendous opportunity to support a more comfortable retirement. The real challenge lies in selecting the best way to access that wealth and make it work for you in retirement.
While there are more tools available to older homeowners today than ever before, not all home equity solutions are created equal.
Why Traditional HELOCs Fall Short for Seniors
Many homeowners are familiar with traditional Home Equity Lines of Credit (HELOCs), but these loans weren’t designed with retirees in mind. Traditional HELOCs require monthly payments, which can add strain to a fixed retirement income and become more difficult to manage over time. And, down the road, those payments often spike significantly during the payback period—right when you should be enjoying your golden years, not worrying about bills.
Qualifying can pose another challenge. Most traditional HELOCs require you to meet strict income and employment criteria, which can be tough if you’re retired or living on a limited income. On top of that, interest rates fluctuate with the market, introducing the risk of higher payments when you least expect them. Even worse, in times of economic uncertainty, banks can reduce or even freeze your credit line, leaving you without access to the funds you were counting on.
That’s why, for many seniors, a traditional HELOC just isn’t the right fit. The good news? There are savvy, more flexible ways to tap into your home’s equity—options designed to work with your retirement lifestyle, not against it.
Senior-Friendly Home Equity Solutions to Elevate Your Retirement
- HECM Reverse Mortgages
Home Equity Conversion Mortgage (HECM) reverse mortgages are designed with homeowners 62 and older at the center. Instead of requiring monthly payments, a reverse mortgage eliminates them entirely while you remain in your home, as long as you meet your loan obligations and stay current on property taxes, homeowners insurance, and required home maintenance.
Reverse mortgages are also structured as non-recourse loans. That means when it comes time to repay the loan and the home is sold, neither you nor your heirs will owe more than the value of the home. And flexible access to funds—whether you need a lump sum, monthly advances, or line of credit1—ensures you can adapt your finances to changing needs and unexpected expenses.
- Platinum
Another option is a proprietary (or jumbo) reverse mortgage, such as Platinum by Longbridge. Platinum offers additional features that go beyond the limits of a standard HECM. Whether you’re looking to maximize your cash today, plan for the future, or leave a legacy, there’s a Platinum option designed to help you reach your goals. Even better, Platinum has a lower minimum age requirement (as low as 55 in some states2), a wider range of eligible property types, and loan amounts up to $4 million.3
- HELOC For Seniors®
Recognizing that traditional HELOCs aren’t ideal for retirees, Longbridge also offers a first-of-its-kind non-reverse mortgage option tailored specifically the financial needs of homeowners 62 and over: HELOC For Seniors®. This product offers unique advantages over traditional HELOCs, including reduced, interest-only payments for the life of the loan4 and easier qualifications by focusing on overall home equity rather than employment income.
Deciding on the right home equity solution is deeply personal and should reflect your own financial goals and comfort level. The right option can help you stabilize your retirement budget, cover unexpected expenses, and even preserve other retirement assets, such as savings or investment accounts.
Take the Next Step
Above all, understanding the differences in the solutions available to you and how each option complements your overall retirement plan is crucial. An honest conversation with a mortgage consultant can help you determine which path best meets your needs—and our knowledgeable team is here to help.
If you’re ready to explore your options and see how your home equity can support your retirement goals, contact Longbridge today and take the next step toward greater financial confidence and peace of mind.