Education
You heard the headlines: the Federal Reserve cut short-term interest rates. But what does that actually mean for your reverse mortgage — or for your plans to get one? In this episode I walk you through the difference between the Fed’s short-term lever and the long-term rates that set reverse mortgage borrowing power. I use plain language, real examples, and 22 years of experience so you can know what to do next.
What you'll learn
- The one thing the Fed really controls: the federal funds overnight rate and how it affects short-term borrowing.
- Why short-term rate cuts do not always lower mortgage or reverse mortgage rates.
- How long-term rates, especially the 10-year Treasury, determine how much you can get from a HECM.
- How a rate cut can help current HECM borrowers by lowering loan interest but also slow line-of-credit growth.
- Why a lower 10-year Treasury increases your principal limit, and why a higher one reduces it.
- A simple example that shows how a HECM line of credit grows and why that matters for future needs.
- Practical steps to protect your retirement income and plan for health, home repairs, and long-term care using a reverse mortgage.
This episode clears up the confusion behind the headlines and gives you clear action steps. You will learn how the Fed’s move may help or hurt you depending on your situation, what to watch in the 10-year Treasury, and how to use a reverse mortgage line of credit the smart way. If you want sensible, direct advice about protecting your savings and staying in your home, tune in.