With a mild climate, beautiful scenery and a wealth of activities, San Diego is a popular place to retire. But with living costs 30 percent higher than the national average it can be challenging for seniors to secure sufficient retirement income. A reverse mortgage can help retirement-age homeowners use their homes as an additional source of income. ConsumerAffairs reviewed the best reverse mortgage lenders in San Diego to help seniors navigate their options.
Seniors who are ready to retire and are concerned about having sufficient savings and income to do so might consider a reverse mortgage to help with the high costs of living in San Diego. According to the Insight Center for Community Economic Development, the cost of living for a single senior homeowner living alone in San Diego is $34,161 per year. In San Diego, one in six seniors is financially responsible for a grandchild, and a reverse mortgage might be able to help with the costs.
Slightly over 50 percent of San Diego residents are homeowners, but for seniors, the percentage living in homes they own is higher, at 75 percent. Thirty-seven percent of senior homeowners have a mortgage. San Diego neighborhoods and suburbs with the most residents 65 or older are Oceanside, Carlsbad, Escondido, Kearny Mesa and Mid-City.
Since seniors represent the highest percentage of homeowners per age group, they can benefit from the recent increases in home equity across the nation. Rising prices mean that homeowners become “equity rich” when their homes increase to values that exceed the amount of the mortgage, as long as they are up to date on payments.
California coastal communities, like San Diego, have seen the most substantial increases in average home equity. Seniors in San Diego who would like to invest in a second home might choose to get a reverse mortgage on their primary residence to finance the purchase.
The following are requirements to qualify for a reverse mortgage in San Diego:
Borrower must be 62 years of age or older.
Borrower’s mortgage must be paid off, or have a very small balance remaining.
The home must be the borrower’s primary residence.
Home must be in good condition and meet FHA minimum property standards and flood requirements.
Borrower must be able to pay for homeowners insurance, property taxes, applicable HOA fees and maintenance.
Most single-family homes, two-to-four unit owner-occupied dwellings, townhouses, approved condos or manufactured homes qualify.
California law allows only one type of reverse mortgage loan: an FHA-insured Home Equity Conversion Mortgage (HECM). Private or proprietary reverse mortgages are not available in the state. The law also requires all lenders to provide a list of non-profit counselors to those taking out a reverse mortgage, and the application cannot be finalized without acknowledgment of such counseling.
This top-ranking reverse mortgage lender makes it a priority to earn and keep your trust. Finance of America Reverse has plenty to offer: lump sum, tenure payment and line of credit options; an average closing time of 30 days; and award-winning customer service. According to customers in San Diego, if you’re unsure of what something means, the team at FAR will go out of their way to explain it to you.
As one of the country’s largest reverse mortgage providers, Liberty Home Equity Solutions has worked with more than 50,000 seniors since 2003, and all of that experience has led to their reputation as industry experts. Offering HECMs and a promise to match or beat all competitors, this lender is an industry favorite. Customers say they love the responsiveness and personal attention provided by Liberty Home Equity Solutions representatives.
This award-winning company prides itself on a 97 percent customer satisfaction rating from in-house surveys. American Advisors Group offers HECMs and an expert staff to assist with the process every step of the way. Customers say that although sometimes the process takes longer than they had hoped, it works out in the end and is well worth the wait.