Give retired clients the certainty and flexibility they seek.

Did you know, homeowners 62 and up have over $7 trillion¹ tied up in home equity? Helping your clients unlock and leverage some of that home equity as part of an overall retirement strategy can prove a winning move for you and the families you serve. Bring greater balance, diversification, and risk management to the families you serve.



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The Challenge

Today, advisors are looking for ways to preserve investments, avoid portfolio losses, secure cash flow and back-up emergency reserves. How can home equity bridge the gap? It’s a financial tool that has been specifically designed for homeowners 62 and older.

The Solution

The Home Equity Conversion Mortgage (HECM) loan is an FHA, government-insured, non-recourse loan on a primary residence, for people at least age 62:

  • Borrowers have the option of whether or not to make monthly mortgage payments as long as they continue to live in the home, pay for property taxes, homeowners insurance, and maintain the home.
  • The loan becomes due when the home is sold, the borrower changes residence, the last borrower (or eligible non-borrowing spouse) dies, or the last borrower is in a continuing care facility for 12 consecutive months.
  • Like any loan, reverse mortgage proceeds are paid out tax-free.

Proceeds from a HECM loan can be distributed monthly, in a lump sum, as a revolving line of credit, or a combination of these. A HECM Line of Credit (HECM LOC) provides access to equity at a predictable growth rate regardless of real estate performance.

HECM LOC in Action

An eligible couple lives in a home valued at $700,000 and owes $240,000 on their mortgage. They take out a HECM loan which pays off their current mortgage and opens a total credit of $113,200. This line of credit grows over the next 10 years to be worth $467,512. They delay a monthly payment on the loan for 2 years, and then start a monthly payment of $2,600 for a total of $31,200 over the life of the loan.

LOC Graph

This example is based on IMIP of $14,000, origination fee of $6,000 and other settlement costs of $2,000. HECM as of 05/12/2020.

Key Outcomes

With a HECM LOC, you and your clients can respond better to market swings. Borrowers can access their loan proceeds during market downturns rather than draw down their investments. Similarly, by using their loan funds to supplement their income, they may be able to delay taking social security benefits until they reach full retirement age.

More Solutions

High-Value Properties: Clients can access up to $4 million in equity on high-value properties with a proprietary reverse mortgage, AAG’s Advantage loan. There is no mortgage insurance required, no capital gains or income tax on loan distributions³ and all loan proceeds are accessed in one lump sum.

Buying a Home: If you have clients seeking to downsize or move closer to family, friends and more of the lifestyle amenities they enjoy, they can purchase a new home, with a combination of their funds and a HECM loan, also known as a HECM for Purchase.

Funding Home Care: According to The Joint Commission, home care can help many patients achieve optimal health outcomes.² With a HECM, your clients may gain greater financial flexibility over their health care decisions, including the choice of aging and living comfortably in place.

All AAG options: VA, FHA, traditional, refinance, jumbo, jumbo reverse, reverse for purchase and jumbo reverse for purchase loans.

¹"Senior Housing Wealth Reaches Record $7.23 Trillion" - National Reverse Mortgage Lenders Association. April 3, 2020. https://www.nrmlaonline.org/about/press-releases/senior-housing-wealth-reaches-record-7-23-trillion
²“Home-The Best place for Health Care”- The Joint Commission.2011. Web.22 Jan 2016. http://www.johnahartford.org/images/uploads/ resources/Home_Care_position_paper_4_5_111.pdf
³Capital gains taxes are only due upon a sale. A Jumbo Reverse Mortgage is a loan, secured by a mortgage on the home, and does not require sale of the home. The proceeds of a loan are not taxable as income.

Below are a number of free, comprehensive financial tools you can use to strategize, plan, measure risk, and engage new prospects. Click on any of the tools below to start.

Identifying Opportunities in Home Equity

This flyer explains how to know when a client is a good fit for a Home Equity Conversion Mortgage (HECM) loan. Use this information to have a positive impact on your clients' financial longevity, liquidity, and legacy.

Read

HECM Loan Basics for Financial Professionals

Learn more about how Home Equity Conversion Mortgage (HECM) loans can be a powerful solution for your clients who are 62 or better.

Read

AAG Advantage Loans - Help Clients Access More

Access MORE with the AAG Advantage Reverse Mortgage. AAG's proprietary advantage loan may allow your clients to convert home equity into more loan proceeds than a traditional reverse mortgage – that’s the AAG jumbo reverse mortgage!

Read

Rethink Reverse

We share your mission of putting the financial security of your customers first and can appreciate the hard work and attention to detail associated with balancing portfolio construction and risk management for long-term success. This booklet explores the use of home equity in retirement planning as an essential in balancing clients' short-term concerns with long-term goals.

Read

Complimentary Webinars for Financial Professionals

Join us at American Advisors Group for our latest complimentary webinars exclusively for financial professionals. Register today for these effective business building strategies and find out why the top financial advisors in the nation trust American Advisors Group.
Click on the links below to register.

Home Equity Solutions for Mass Affluent Retirees in an Uncertain Market

Now more than ever, the need to diversify is evident. Home Equity Conversion Mortgage (HECM) loans are a flexible financial tool that can be integrated into multiple strategies for your affluent client families. In this 60-minute CE approved session, you'll:

  • Learn strategies that provide payment flexibility using a reverse line of credit
  • Understand how to protect access to home equity even if we see a downturn in real estate
  • See how access to equity can provide an alternative to taking withdrawals and realizing losses in investment portfolios
  • Obtain working knowledge of the unique features of a growing line of credit with payment flexibility
  • Hear what other advisors and professionals are saying about home equity strategies that are contrary to common belief
Watch Now

Monetizing Home Equity to Benefit Clients and Your Business

With home equity representing the largest asset on many of your clients’ balance sheets, doesn’t it seem prudent to consider responsible and effective ways to include it in your plan design? Join us as we share solutions and case studies designed by advisors, for advisors, to uncover risk mitigation strategies you may not know exist. In this 60-minute CE approved session, we’ll discuss:

  • Why home equity matters
  • How home equity is being used by clients and their advisors
  • Traps, hurdles, and hidden fees
  • The impact on your business
Watch Now

A Case Study: Advanced Planning Strategies for Mass Affluent Baby Boomers with Housing Wealth

This webinar takes you on a deep dive into the “Brad & Heather Case Study” by walking participants through 30 years of retirement for a mass affluent family.

After taking the recommendation of their advisor to put a HECM Line of Credit in place, Brad and Heather are in a stronger financial position to address a wide range of potential challenges, needs, and opportunities in retirement:

  • A downturn in their investment holdings
  • A home renovation
  • A downturn in real estate
  • In-home care needs
  • The death of a spouse
  • The transition to the next generation

Through their story, we will highlight the specifics of how the strategic use of a HECM LOC can improve retirement for millions of Americans.

Watch Now

Meet the Team

Hank Sanders

Hank Sanders

Strategic Business Specialist, AAG

As a strategic business specialist for AAG, Hank specializes in education, supporting, and developing relationships with financial advisors.

Hank began his career in financial services as a financial consultant with Merrill Lynch, Pierce, Fenner & Smith in 1986. Just over one year into his career, Black Monday reset the entire industry’s perspective of investment risk and had a tremendous impact on Hank’s approach to serving his clients. Hank began to redefine his business, taking a holistic approach in designing comprehensive financial plans, investment solutions, and strategies based on the client’s prioritized goals for the one life they get to live, while targeting the least amount of risk necessary.

When he joined the team at AAG to educate industry professionals on the integration of housing wealth strategies into comprehensive planning for the mass affluent retiree, Hank knew he could have a great impact on the industry and, potentially, thousands of lives.

Ryan Ponsford

Ryan Ponsford

Strategic Business Specialist, AAG

Ryan has been involved in wealth management, real estate, business building, and philanthropy for over two decades.

From designing strategic solutions to some of our nation’s wealthiest families, creating business systems for rapidly growing companies, and founding and expanding Main Street Philanthropy, a non-profit organization, across the nation, his experience is extensive, yet built upon a repeatable set of core principles.

Ryan has been recognized as a thought leader, disrupter, and innovator in designing purpose-driven financial solutions that integrate illiquid assets, multi-generational wealth strategies, and inclusion of real estate into retirement solutions. With American Advisors Group, he leads a team specializing in designing solutions and education for financial professionals on how to effectively integrate home equity into retirement strategies.

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Financial Disaster Equals New Opportunity

In an environment where seniors’ retirement futures have already been put at risk by dwindling savings and disappearing pensions, the idea of the reverse mortgage is to allow a senior to use the equity in their home to either meet necessary expenses in old age, or to enhance their quality of life in retirement. Read […]

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Don’t Overlook Reverse Mortgages in a Crisis

While recent legislation aimed to assist Americans in the midst of economic turmoil caused by the COVID-19 pandemic has been beneficial, mortgage forbearance options made available to people through the Coronavirus Aid, Relief, and Economic Security (CARES) Act have not addressed other living expenses that could leave people on fixed incomes vulnerable. This is why […]

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Senior Housing Wealth Hits Record High of $7.54 Trillion

Homeowners aged 62 and older saw their collective housing wealth increase in Q1 2020 by 1.6% compared to the previous quarter. This constitutes an increase of approximately $120 billion to a record of $7.54 trillion. Read more…

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Pandemic Leading Financial Planners to Reverse Mortgages

While the relationship between financial planner professionals and the reverse mortgage industry is evolving in a positive direction, there are still a number of things that the reverse industry can and should observe when aiming to facilitate connections with those planners as potential referral partners. This is according to a trio of financial experts discussing […]

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Strategic Tax Planning for the Wealthy with Reverse Mortgages

The Tax Cuts and Job Act of 2017 (TCJA) dramatically changed tax law in our country. It has a profound effect on mortgage interest deductibility and actually elevated the reverse mortgage as an enhanced tool for strategic IRA withdrawals, Roth conversions, Net Unrealized Appreciation (NUA), and other strategies centered around deferred or accelerated tax accounts. […]

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HECM Line of Credit vs. HELOC

In business, a line of credit can help protect and strengthen an enterprise in countless ways. Defensively, the owner can use it to help meet short-term capital needs or, proactively, to seize an offer simply too good to pass up. It automatically gives the business owner more options to nimbly and strategically meet almost any […]

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American Advisors Group, NMLS #9392, headquartered at 3800 W. Chapman Ave., 3rd & 7th Floors, Orange, CA 92868.

News & Updates

Financial Disaster Equals New Opportunity

In an environment where seniors’ retirement futures have already been put at risk by dwindling savings and disappearing pensions, the idea of the reverse mortgage is to allow a senior to use the equity in their home to either meet necessary expenses in old age, or to enhance their quality of life in retirement. Read […]

Read More

Don’t Overlook Reverse Mortgages in a Crisis

While recent legislation aimed to assist Americans in the midst of economic turmoil caused by the COVID-19 pandemic has been beneficial, mortgage forbearance options made available to people through the Coronavirus Aid, Relief, and Economic Security (CARES) Act have not addressed other living expenses that could leave people on fixed incomes vulnerable. This is why […]

Read More

Senior Housing Wealth Hits Record High of $7.54 Trillion

Homeowners aged 62 and older saw their collective housing wealth increase in Q1 2020 by 1.6% compared to the previous quarter. This constitutes an increase of approximately $120 billion to a record of $7.54 trillion. Read more…

Read More