All About Estates

Reverse Mortgages: The good, the bad and the ugly

Many seniors today are considering taking a reverse mortgage. Why? For those who are house rich but cash poor, it provides for the home owner to receive a lump sum of money, without having to make monthly payments. For those seniors (minimum age is 60 ) who require funds for home renovations for accessibility, or need to have 24 hour care available or want to have access to additional funds, this may be a reasonable choice. While interest rates may be higher and are compounding, there may be other less expensive options to consider. The biggest advantage is that there are no interest or principal payments and money owing is repaid when you die or sell your home- however this will leave less cash in the estate. While no one can put a value on the feeling that one has by being able to remain in their own home, a reverse mortgage may be one way to achieve this; but there may be other ways as well. Most seniors want to remain in their own homes. In some cases, it may not be possible due to safety, accessibility or medical reasons. However, if one has the financial resources to make this happen, then this should be explored. While a geriatric care manager can assist in exploring residential and accessibility options, a financial planner should also be involved to see what makes the most sense from a financial perspective. – Audrey Miller

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About Audrey Miller
Email: amiller@eldercaring.ca About: Audrey Miller, Managing Director of Elder Caring Inc. has over 25 years social work and rehabilitation experience working with older individuals and their families. She advises the financial, insurance, legal and business communities regarding elder care issues. Audrey is a recognized expert in her field.