Blogs in Real Estate

There are a wide variety of uses for the money that is gained from a reverse mortgage.  Some of the most common uses of a reverse mortgage are:

Pay off existing mortgages.

Free up monthly income.

Do home improvements.

Pay off credit card debts.

Pay for in-home health care.

Purchase long term care insurance

Supplement income.

Plan your estate.

Purchase a car.

Travel.

Prepare for emergencies.

Help family members.

Reverse mortgage payments do not affect Social Security or Medicare benefits because those benefits are not based on the assets of the borrower. However in certain programs, beneficiaries must keep their liquid assets under certain limits. Generally, if the proceeds from the reverse mortgage are not spent in the month received, then these funds are considered part of the liquid assets and may adversely affect eligibility for SSI and other programs. Therefore, a borrower who also receives SSI or participates in other income or need based programs should never draw more money than the borrower actually needs to spend that month. Regulations for state-administered programs such as Medicaid and food stamps all have different eligibility requirements. Accordingly, it is suggested that the borrower consult their attorney, financial advisor, or a benefits specialist at the local area Agency on Aging or the local offices for these programs to determine how reverse mortgage payments may affect the borrower’s particular situation.