In the golden years, everyone encounters a new set of challenges. Even if you or your parents are in relatively good health physically and financially, they may find themselves short on income and incurring new expenses. If they need in-home care or need to make their home more accessible in order to get around, these expenses may make it more difficult to stay in their home. One method that seniors are using to stay in their home is the reverse mortgage, an instrument that turns home equity into income to cover these unexpected financial obligations.
How Can A Reverse Mortgage Help You Stay In Your Home?
Your parents are starting to need some help with daily routines, but they do not want to move in with relatives or into an assisted living facility. They want to stay in the comfort and familiarity of their own home, but would need in-home care to continue to do so safely. Hiring in-home care is an important, but new expense. A reverse mortgage can help with this. Shifting available equity of the home to cover these costs can be a good move and can considerably relieve financial pressure and help your parents enjoy their retirement instead of cutting corners or worrying about paying for essentials.
Is A Reverse Mortgage Right for You?
There are three questions that you and your parents need to ask when considering a reverse mortgage:
- How long will you stay in your home?
If you are the borrower, it is important to make a decision of whether you intend to stay in your home for the rest of your life or if a retirement community is in the future. If the home is sold or if the borrower moves, the reverse mortgage is due within six months. This comes with a hefty closing cost. These loans are designed for homeowners who intend to stay for a long period of time as the fees are spread out over a longer period of time this way.
- What would the reverse mortgage be for?
This mortgage is best for covering expenses that come with aging such as in-home care or remodels to increase accessibility and livability for those suffering from an age-related disability. Although it may be tempting to refinance to have more spending money or to take vacations, there may be better ways to attain recreation and enjoyment. The costs of a reverse mortgage from fees need to be discussed and considered.
- Is remaining equity a concern?
If the property is designated to be handed down in the family, a reverse mortgage may carve out a significant part of the equity and therefore shift a debt obligation to the next generation. If you will be the ultimate recipient and will be affected by this, make sure that the remaining mortgage debt will be something that you will be able to handle. When things are difficult in the present, it can be hard to worry about the future, but consider this carefully and be prudent in your decision.
Make The Right Choice
A reverse mortgage is one way to help seniors stay at home instead of moving to a assisted living facility, and if may be a good choice if family members have moved too far away to help around the house. It can fund in-home assistance and features that will make everyday living easier. Despite the challenges that come with seniors staying at home, there are both easily understandable practical and emotional reasons to do so. Although there is a cost that comes with a reverse mortgage, the happiness and security that it can bring may be worth the cost. You can talk with a reverse mortgage specialist and counselor to see if it make sense for you.
Interested in finding out if a reverse mortgage may be right for you?
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*Not an affiliate of A Peaceful Way Home Care. Please conduct your own due diligence before conducting in business transaction.