Seniors living on fixed incomes may be faced with various financial challenges as they age. If your elderly loved one is a homeowner, he or she may want to consider taking out a reverse mortgage loan. The staff at Home Care Assistance, a leading provider of at-home care in Fort Myers, has put together a list of benefits your loved one can gain from this option.
Protection from Market Declines
The federal government insures reverse mortgages, which covers the difference if your loved one should sell his or her home for less than the amount of the loan. The loan is considered paid in full from the proceeds of the sale.
No Impact on Social Security and Medicare
Since a reverse mortgage is a loan, it is not considered income, which means government programs like Medicare and Social Security are unaffected by it. However, it is important to note reverse mortgage proceeds may impact your loved one’s eligibility for need-based programs, including Supplemental Security Income and Medicaid.
Wide Choice of Disbursement Options
A reverse mortgage may offer your loved one more flexibility than other types of loans. For example, he or she can choose to have the loan proceeds disbursed in one lump sum, in monthly payments, or as a line of credit. This allows your loved one to structure the loan to meet his or her unique financial needs.
Continued Ownership of the Home
Many seniors believe a reverse mortgage means they no longer own their home. However, a reverse mortgage does not transfer ownership to the lender. Your loved one maintains ownership as long as he or she remains in the home, pays applicable taxes and insurance, and complies with the loan terms. If your loved one should pass away, you and any other heirs can pay off the loan and keep the home, sell the home and keep any capital gains, or deed the house back to the lender.
No Mortgage Payments
A traditional mortgage requires your loved one to make monthly payments to remain in the home. With a reverse mortgage, the lender makes payments to the borrower. No additional payment is required until the borrower sells the home, moves to another residence, or passes away.
A reverse mortgage can also be used to help pay for long-term home care. If your loved one needs help maintaining a happy and healthy life, turn to Home Care Assistance. Our caregivers are trained to assist seniors with a wide array of important tasks, and we also offer comprehensive Parkinson’s, stroke, and home care Fort Myers families trust. For more information on our elderly care services, call one of our knowledgeable Care Managers at 239.449.4701 to schedule a complimentary in-home consultation.