Reverse Mortgages: Risks and Opportunities

E. Di Lorenzo (), G. Piscopo (), M. Sibillo () and R. Tizzano ()
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E. Di Lorenzo: University of Naples Federico II, Department of Economic and Statistical Science
G. Piscopo: University of Naples Federico II, Department of Economic and Statistical Science
M. Sibillo: University of Salerno, Department of Economics and Statistics
R. Tizzano: University of Naples Federico II, Department of Economic and Statistical Science

Chapter Chapter 29 in Demography of Population Health, Aging and Health Expenditures, 2020, pp 435-442 from Springer

Abstract: Abstract Reverse Mortgages (RM) provide an attractive way to increase retirement incomes and to face the needs of health care for elderly people. The RM market is exposed to a number of risks: longevity risk, as retirees’ life expectancy increases, interest rate risk, especially in the low-rate post-crisis period, property market risk, in the last stage of the current business cycle. The paper focuses on reverse mortgage contracts whose expiry is a function of the contractor’s life span and whose assets depend on the evolution of real estate market prices. A neural network procedure is employed in order to include a range of explanatory variables as part of the Reverse Mortgage evaluation algorithms.

Keywords: Artificial intelligence; Neural network; Pension product; Real estate; Reverse mortgage (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:spr:ssdmcp:978-3-030-44695-6_29

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DOI: 10.1007/978-3-030-44695-6_29

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