Debt consolidation may help you roll all your debts into one loan with manageable, lower interest payments. The ASAG Reverse Mortgage may be the perfect solution for debt consolidation needs during your golden years.
Since the mid-1990s, the price of houses has increased at a faster rate than income, which has led to three times the amount of people carrying mortgages and debt into retirement. When paired with the ageing population, this leaves many retirees strapped for cash in their supposed ‘golden years’.
The problem with debt in retirement is that income is limited. Given that many are living on their pension alone, it can be hard to pay for anything outside the basics. It is really not enough to continue making repayments for a mortgage or other debts, let alone live a comfortable retirement, free from financial difficulties.
Some may try to remedy this by using credit cards or getting a loan just to get by. However, these financial products are not usually designed to fit in with a retiree’s lifestyle and income. With high interest rates and regular loan repayments, many are not able to keep up.
There is an option to downsize and use the proceeds to pay off debt. But most seniors aged 60 and over would like to stay in their home because of an emotional attachment to it, so downsizing isn’t always the best option.
Other option to pay debts
Due to the rising number of retirees with debt, there is an increased demand for financial products that will suit them and their situation. Taking out a reverse mortgage is an option that has become popular because it is specifically designed to address the needs of seniors. This may include:
- Loan repayment. There’s no requirement for ongoing payments. However, voluntarily doing so can be made at any time. The total interest charged and the amounts drawn will be payable at the end of your loan when you move permanently out of your home.
- Loan usage. A reverse mortgage proceeds can be used for debt consolidation, turning outstanding debts into one lump sum. This lessens your worries and stress and allows you to live a more comfortable retirement. This is what most ASAG customers use their funds for.
- Loan access. Aside from consolidating debt, a reverse mortgage fund can be used as a regular income stream for your expenses or a cash reserve for emergencies such as home improvements, a new car, medical expenses, travel, and much more.
Using the ASAG Reverse Mortgage for Debt Consolidation
Most of our customers in Victoria use ASAG’s equity release solutions for any purpose to meet their needs in retirement, including Debt Consolidation. You can use the ASAG Reverse Mortgage if you’re thinking of consolidating your debts, such as existing mortgages or credit cards, to eliminate multiple repayment requirements.
With the ASAG Reverse Mortgage in Victoria (VIC), accessing some wealth in your home for your objectives in retirement is possible without ongoing payments and selling your home. You have the option to draw down your funds as either a lump sum, regular instalments or a cash reserve.
Find out more about our reverse mortgage and how it could help you consolidate your debt in retirement by contacting us. Our lines are open on 1300 002 724 and at email@example.com so give us a call or send your enquiries about our equity release solutions.
You can also get started by using our free tool below to assess the available equity in your home.