It's becoming harder for reverse mortgage cases to hold weight in the courtroom when companies explain the use of equity as a retirement asset.
The reason for this miscommunication is simply a lack of education on the subject, but also because of the financial planning community's reluctance to adopt it as a part of retirement, according to a recent report.
“Attorneys and judges aren’t financial advisors, and while many of them may have a solid grasp of the key concepts, I found myself needing to explain every minor detail, including assumptions and what-if scenarios that are usually discussed but not calculated into the plan,” said Robert Laura, a financial planning writer for Forbes, according to Reverse Mortgage Daily.
“Yes, it is an asset, but they also need a place to live during retirement. Whether they stay put or use the equity to downsize or eliminate their mortgage, you can’t just throw every asset into the mix for retirement income.”
Ultimately Laura believes that too many aspects of reverse mortgages tied in with retirement plans are up to the interpretation of financial planners. It that is the case, it is additionally harder for it to be interpreted in a courtroom.
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