Gaining Financial Freedom

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Mr. and Mrs. Parks had lived in their family home for 36 years when they began to fear that their mounting debt might cause them to lose it. They no longer wanted to answer the phone because of the countless calls they were receiving from creditors. Their situation was so bad that Mr. Parks, who is 80 years old and has a heart condition, was working every morning at the local 7-11 to supplement their income.

When they were both working full-time, they were able to make ends meet, but since retiring, their credit card debt had escalated. For three years, the couple struggled with rising health care costs. After Mrs. Parks lost her job, the burden became unbearable.

Unsure of the scope of their debt and fearful for their financial future, Mrs. Parks contacted East West Mortgage about a Reverse Mortgage on their home. Robert Ready, the Director of East West Mortgage, met with Mrs. Parks at their home.

He recalls, “The phone rang from the time I arrived until the time I left. I stopped counting calls at 15. All of the calls were from creditors.” After talking with Mrs. Parks, Robert discovered that she had been pressured by credit card companies into allowing her checking account to be debited as soon as her social security check arrived.

Mr. Ready explained that neither credit nor income is a consideration for the Reverse Mortgage program. The only qualification is that you be at least 62 years of age. After hearing this, Mrs. Parks decided to proceed with the program.

The couple’s financial situation proved to be even more complex than they realized, as Robert explains, “When I got back to my office and started the process, which included checking their credit, I discovered the Parks had $150,000.00 of credit card debt.”

Luckily for the Parks, East West Mortgage is directly affiliated with Widmann Financial Services, and Mr. Ready was able to quickly schedule a conference with one of the Certified Financial Planners in the office, as well as an Elder Law Attorney and a Bankruptcy Attorney. One of the first goals of this team of professionals was to help the Parks get some relief from the hounding creditors. They suggested that the couple change their phone number, and they also contacted the bank to stop the automatic transfer of funds to the credit card companies.

Ultimately, the team of professionals assembled by East West Mortgage was able to work together to help the Parks get out of debt and remain in their own home: “In the case of the Parks, based on their age, market value of their home, and current interest rates, the reverse mortgage provided approximately $155,000 in funds. After six weeks, the attorney had settled all debts for slightly better than 50% of what was owed. The Parks have about $80,000 remaining from the reverse mortgage in a line of credit earning a current rate of growth of 3.83%. Most importantly, they avoided bankruptcy and got to remain in their home with no monthly mortgage payment.”

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