Financial planners aren't completely counting out reverse mortgages as a viable option, though, they do believe there is still work left to be done in improving them. A new reveals what some of the major concerns are when it comes to suggesting a reverse mortgage for a client.
"Joseph Conroy, a Certified Financial Planner at Synergy Financial Group in Towson, Md. says that reverse mortgages tend to rank toward the 'bottom' of the hierarchy for client funding sources, coming in 'just above' taking a premature IRA or 401K distribution and paying the taxes and penalties," according to Reverse Mortgage Daily.
“[A reverse mortgage] is expensive, it takes away from future options and flexibility and should really only be considered as a last resort type of option.”
While some experts like Conroy see reverse mortgages as a last resort, others like Lauren Klein of Klein Financial Advisors in Newport Beach, CA believe it should still be considered to be a viable option. Klein believes that writing them off completely would be "inadvisable," according to the report.
"A reverse mortgage should never be used as a last resort when all other assets have been depleted," Klein said.
"Having this flexible resource available if and when it’s needed can help turn a client’s home equity into a powerful and strategic financial planning tool for decades to come."
To learn more about the the current reputation of reverse mortgages among financial planners, click on the image above.