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Becky Said:

My mom is 74 and is behind on her mortgage due to cancer. She is concidering a reverse mortgage.?

We Answered:

I am sorry for your Mum's situation, that is really hard to deal with. May I suggest that she first talk to her lenders and see if they can offer her any help? Once they know of her situation, they might be willing to be flexible. Also, can her family members help her out for a while? I know that's not always possible, but it is worth a thought.

Best to your Mum. Please look at all other avenues first before a reverse mortgage, as the equity isn't very high.

Vanessa Said:

Are reverse mortgages a good deal?

We Answered:

Reverse mortgages are good thing not a bad thing. AARP, The National Council On Aging, etc., lobbied for a government sponsored reverse mortgage program.

Reverse mortgages help many seniors stay in their homes by giving them monthly income, paying for home health care, paying for home improvements to “age in place”, paying off current mortgages and debts so monthly payments do not need to be made anymore, etc.

Reverse mortgages are completely designed for seniors and their needs, versus traditional mortgages which are not.

Reverse mortgages allow for life estates and trusts to protect a senior’s home equity from Medicaid reimbursement, where traditional mortgages do not.

The problem with reverse mortgages is that the loan program is almost universally misunderstood. Because of this many seniors that could stay in their homes with a reverse mortgage do not know this, and end up in a Nursing Home prematurely. Their home equity then goes towards paying for the Nursing Home versus towards staying in their home.

Many people also have unrealistic expectations. A reverse mortgage is a mortgage loan and just like all mortgages there are closing costs and interest, even though you don’t pay these until you permanently leave the home.

A reverse mortgage is a benefit available at reaching 62 years of age, just like Social Security.

Reverse mortgages aren’t for everyone and cannot solve every senior’s problem, but reverse mortgages can and do help a lot of people.