From the Rocky Mountains and Great Basin to the Pacific Coast, the Western region of the US is the most expansive region of the country, accounting for more than 42% of the country’s total land area1. The Western region consists of Colorado, Wyoming, Montana, Idaho, Washington, Oregon, Nevada, Utah, California, Alaska, and Hawaii.
The most geographically diverse region of the US, the West encompasses to the temperate rainforests of the Northwest, the country’s highest mountain ranges, areas of the Great Plains, and several desert environments. The region is also home to some of the nation’s largest cities and metropolitan areas, including Los Angeles, San Diego, San Jose, San Francisco, Seattle, Denver, and Portland. And with many of the Western states situated along the Pacific Ocean, the region truly offers something for everyone.
With this in mind, it’s no surprise that the Western US accounts for just over 20% of the nation’s total population, with over 69 million people calling the region ‘home2.’ And among this total population is a notable population of seniors – with nearly 16% of the Western population age 65 or older.
| State/Territory | Total Population | Percentage of population ages 65+ |
|---|---|---|
| Colorado | 5,812,069 | 14.6% |
| Wyoming | 578,803 | 17.1% |
| Montana | 1,104,271 | 19.3% |
| Idaho | 1,900,923 | 16.3% |
| Washington | 7,738,692 | 15.9% |
| Oregon | 4,246,155 | 18.2% |
| Nevada | 3,143,991 | 16.1% |
| Utah | 3,337,975 | 11.4% |
| California | 39,237,836 | 14.8% |
| Alaska | 732,673 | 12.5% |
| Hawaii | 1,441,553 | 19.0% |
| Total = 62,274,941 | Average = 15.9% |
From natural beauty, to bustling cities, to quality healthcare systems, pleasant weather, and much more, the Western region is increasingly becoming a retirement destination. In fact, a recent report ranking the best states for retirement3 positioned 3 Western states in the top 10. These included Colorado at #3, Montana at #7, and Utah at #8.
For lifelong Western natives to relocated retirees, seniors across the region are increasingly opting to live independently in the houses they’ve come to know as “home.” As this concept – known as “aging in place” – gains momentum, many senior homeowners are making proactive home modifications and improvements to support aging needs. But it’s no secret that home improvements projects come with (an often hefty) price tag…
Fortunately, for many senior homeowners, there is an untapped source of wealth that can be accessed to fund these projects and more. And it’s right in their homes.
Home Equity in the West
So what exactly is home equity? Simply stated, home equity is the portion of your home that is paid off – or your stake in the property that is owned. Home equity is also among the top sources of wealth for retired homeowners. In fact, more than two-thirds of total wealth for the average 65-year-old American couple is comprised of home equity4. And with senior homeowners now accounting for upwards of $10.6 trillion in home equity5, you may be surprised to see just how much equity is in your home.
If you’re interested in tapping into this home equity to supplement retirement income or unlock an additional source of cash flow, a reverse mortgage could be a viable solution. Also known as a Home Equity Conversion Mortgage (HECM), a reverse mortgage allows you to convert a portion of your home’s equity into cash to be used however you wish. Just like a traditional forward mortgage, you’ll retain the ownership and title to your home and continue to live there as your own. But unlike a traditional mortgage, reverse mortgages do not require monthly mortgage payments6. The funds received from the loan do not need to be repaid until after the final borrower no longer resides in the home7.
Can I Get a Reverse Mortgage in the West?
If you are at least age 62 and live in the Western region of the United States, the answer is YES. Reverse mortgages are available in Colorado, Wyoming, Montana, Idaho, Washington, Oregon, Nevada, Utah, California, Alaska, and Hawaii.
How Much Money Can Retirees in the West Get with a Reverse Mortgage?
Good question! As previously mentioned, reverse mortgages allow you convert a portion of your home’s equity into cash. But just how much can you access? This amount is known as the “principal limit” and is calculated by accounting for several factors such as age, type of reverse mortgage loan, current interest rate, and of course – home value. And speaking of home values, the West boasts the highest home values of any region across the country8, so you may be surprised to see just how much your home is worth.
| Average Home Values: 2022 | |
|---|---|
| Colorado | $569,952 |
| Wyoming | $312,604 |
| Montana | $436,252 |
| Idaho | $470,489 |
| Washington | $606,643 |
| Oregon | $509,539 |
| Nevada | $445,515 |
| Utah | $555,263 |
| California | $774,899 |
| Alaska | $315,353 |
| Hawaii | $863,632 |
| Average = $532,740 | |
Zillow Home Value Index, Data as of March 2022
How Retirees in the West Can Use Reverse Mortgage Funds
Combining geometric shapes with rustic charm, Southwest style homes are unique in character and In addition to high home values, the Western region is home to an eclectic array of housing styles, including Mediterranean, Ranch, and Modern styles. With a rich history and culture embedded in spending quality time with friends and family, the old saying, “home is where the heart is” rings especially true in the West. But the reality is that as we age, so do our homes. And your Western dream home of years ago, may now be in need of some updates. From a standard room remodel, to updates to the look and feel of your home, or even modifications to align with aging needs, reverse mortgage proceeds can be used to fund home projects of all scopes and sizes. And that’s just one popular way we see homeowners leveraging cash from a reverse mortgage. Other common use cases include:
- Keeping extra cash on hand for everyday expenses – such as bills, credit card balances, and other debts.
- Setting aside money for healthcare expenses – both present and future. With Fidelity estimates indicating that the average 65-year-old couple may need approximately $315,000 saved (after tax) to cover healthcare expenses in retirement9, you can never be too prepared.
- Establish a growing line of credit for peace-of-mind now, and a potential “safety net” for unexpected expenses in the future.
- Contribute to significant expenses among family and loved ones. From a wedding to college tuition, to a first car, or down payment on a home, the equity in your home can be used to help those who are near and dear to you.
When it comes to ways to use cash received from a reverse mortgage, the possibilities are endless. After all, it’s your home equity – so you can use the cash however you see best fit.
This flexibility is one of the key benefits of a reverse mortgage that is often praised by retirees. While a traditional Home Equity Line of Credit (HELOC) also offers a mechanism for tapping into home equity, a reverse mortgage offers greater stability, at a comparable rate. And this stability has been especially important in recent years. Back in the early days of the COVID-19 pandemic in 2020, many banks and lenders had to freeze or suspend HELOC applications and originations. But throughout these tumultuous times, reverse mortgages remained available, exemplifying the staying power of the product.
In the days since, reverse mortgages have continued to gain traction with the senior population, especially across the Western region. Just check out the number of reverse mortgage loans closedin each Western state last year10:
| Reverse Mortgages in 2021 | |
|---|---|
| Colorado | 3,772 |
| Wyoming | 75 |
| Montana | 215 |
| Idaho | 1,269 |
| Washington | 2,922 |
| Oregon | 1,616 |
| Nevada | 1,359 |
| Utah | 2,443 |
| California | 13,771 |
| Alaska | 33 |
| Hawaii | 140 |
| Total = 27,615 | |
Data: U.S. Department of Housing and Urban Development
Funding Your Retirement in the West
From stunning views and scenery to 2,500 miles of marine shoreline, and a temperate climate, there are plenty of reasons to call the West home – especially in retirement. And if you’re part of the 90% of senior homeowners wishing to “age in place”11 and stay in your current home into advanced retirement years, a reverse mortgage could provide the financial means to do so.
At Longbridge Financial, we specialize in helping you use hard-earned home equity to address the At Longbridge Financial, reverse mortgages are all we do. And we can help you use your hard-earned home equity to address the financial challenges that impact so many Americans who are in, or preparing for, retirement. Our team of reverse mortgage professionals are experts in the business and will only recommend the reverse mortgage program once certain that it’s best fit for your unique needs and situation.
WBetter yet, at Longbridge, our loan program is insured by the U.S. Department of Housing and Urban Development. We’re also a proud member of the National Reverse Mortgage Lenders Association (NRMLA) and fully adhere to its code of ethics.
Want to see what tapping into home equity can do for you? To see how much you may qualify for, run the numbers with our Free Quote Calculator, and for more information, contact the Longbridge team today.
