Case Study 1 - Fred & Margaret

Fred and Margaret still very active at the golf club and planned on going into a retirement village within the next 2 years, but wanted to do up their house a bit to improve it’s value, get a new car and have enough spare money each month in case they were invited away on a golf trip with their friends. Their house was valued at $430,000 and Margaret was the youngest at age 68. Therefore they were entitled to borrow $98,900 maximum which was way more than they needed.
They decided on taking up to $30,000 in a lump sum to purchase a car, another $15,000 with flexible redraw for renovations, and a $500 monthly payment over two years for their lifestyle.
Two years later they sold their home for $512,000 paid out the $65,000 owing on the loan and had $447,000 left in equity to invest as they saw fit.

During that two years they went on six interstate golf outings which they would have not been able to afford without the reverse mortgage.