CNBC included reverse mortgages in a list of “innovative approaches” to protecting retirees’ portfolios in down times, citing a financial advisor who said he and his colleagues would be “remiss” if they didn’t suggest Home Equity Conversion Mortgages as a potential option.
Rob O’Dell, a certified financial planner in the Naples, Fla. office of the Coyle Financial Counsel wealth management firm, told the network’s website that the reverse mortgage industry has “cleaned up this space to benefit the end consumer.”
“The HECM positions the portfolio for longevity, O’Dell said, by having the client tap the line of credit instead of assets when the market is down,” the post notes, echoing an increasingly popular angle for promoting the reverse mortgage. “In this way, assets are preserved and have the opportunity to keep growing through the years.”
The post warns consumers that HECMs still require HUD insurance premiums and lead to the accrual of debt, but generally positions the product as a tax-free way to diversify consumers’ retirement plans.
“The HECM allows the borrowers to be in control of their loan and payment terms, not the lenders,” O’Dell told CNBC.