If your aging loved one has a good amount of equity in his or her home and wants a little more financial stability each month, he or she may want to consider a reverse mortgage. The Palm Beach elder care experts at Home Care Assistance have put together a list of 4 ways your loved one can benefit from taking out this type of loan.
1. It Provides Reliable Income
The monthly payments offered by a reverse mortgage are ideal for seniors who have equity in their homes, but have little income to live on each month. The funds can be used to pay for any costs incurred, including daily living expenses. The amount of the payment varies depending on the value of the home, but the payments are reliable and provide a safety net if your loved one has limited income.
2. Your Loved One Can Stay in the Home
Unlike selling the home outright, a reverse mortgage allows your loved one to continue living in the home until he or she passes away. Family members can pay the loan if the home is to remain in the family, or the bank can sell the home to repay the loan amount. Seniors who receive the full value of the loan may stop receiving payments, but your loved one doesn’t have to vacate the home or repay the loan even if the reverse mortgage is paid in full.
3. The Income Is Tax Free
If your loved one sold the home, he or she would have to pay taxes and fees on the amount. Additionally, the lump sum payment received after selling can interrupt benefits like Social Security, which isn’t ideal for seniors on a fixed income. A reverse mortgage is tax free, and it doesn’t prevent the payment of other benefits your loved one is eligible for.
4. Foreclosure Can Be Prevented
A reverse mortgage allows seniors who are unable to pay their monthly mortgage to avoid being foreclosed on. Many reverse mortgage programs are available, including state-funded programs. After choosing the reverse mortgage that is right for your loved one’s personal finances, he or she can use the funds to pay back taxes or to pay for other expenses that may prevent him or her from staying in the home.
Your loved one can also use funds from a reverse mortgage to help pay for in-home care services, which may include assistance with daily exercise, meal prep, transportation, and much more. At Home Care Assistance, our caregivers are trained to assist with these and many other tasks, and we also offer specialized Parkinson’s, post-stroke, and Alzheimer’s care in Palm Beach. For more information and to schedule a free consultation with a Care Manager, call 561.429.8292 today.