Keep the LVR low and don’t borrow too much
Minimum amounts you can borrow in a reverse mortgage tend to be around $10,000, however, the maximum can be as much as $1 million. Making sure your loan-to-value ratio (LVR) isn’t too high is something to consider. Your loan-to-value ratio (LVR) is the percentage that you borrow relative to the total value of the home. Reverse mortgage providers all have different maximum LVRs but as a guide they will loan anywhere from around 10-20 per cent up to an age of at least 60 but get more generous as you get older and allow you to have an LVR of up to 45 per cent. By keeping your LVR low you should not find yourself in a position where your debt is worth more than your house and increase the chance there will be something left over to pass on to beneficiaries. Like any investment, speak to a licensed financial planner before you take any action.