Anyone here have luck with a reverse mortgage?

i would check with a CPA or elder law attorney before getting tied up in a reverse mortgage. Their advice would be better than what the reverse mortgage brokers would tell you.

I have no knowledge. You may get some here, but meanwhile, go to www.aarp.org  and above in search put 'reverse mortgages'.  They have info.

Shellroc2977, sounds like your Mom may eventually need 24 hour care, thus she would need 3-shifts of caregivers to come to her home. My dad had this arrangement because he was a fall risk, but it was very expensive. In my area having 3-shifts per day was costing Dad $20k per month, yes per month.

What my Dad did was sell his house, and use [after closing costs] the equity toward Assisted Living/Memory Care which was about $7k per month.

At this point in time, your Mom wouldn't be able to obtain a reverse mortgage, as she would need to be able to understand the paperwork.

Reverse Mortgages are more geared for those who have money, and wish to take out equity to use in the stock market or other investments knowing they will gain more than what the cost would be to repay the reverse mortgage.

Look into Assisted Living/Memory Care facilities. The ones in my area are built more like hotels than institutions.

The reverse mortgage can be used to pay off her existing mortgage. And she has to pay the fees and closing costs on the RM Upfront which will exceed $10,000. I don’t think a RM is the way to go. Because she can’t sigh the papers like FF said. And because Her house is almost paid off. The money from the RM won’t pay for the care she needs for very long. If she needs 3 shifts, round the clock care, the RM would probably pay for a little over 2 years of care. And when she dies, the house would go to the reverse mortgage company. So for someone who owes so little on their house, I’d try to sell it and get her in to long term care. It doesn’t have to be a nursing home. Look in to small care homes with 4-6 residents.

I would sell the home, a reverse mortgage would not resolve the issue. She can be placed in Memory Care, there are some very nice homes where she can live out the rest of her life, there is no reason for you and your siblings to be depressed. This is about what is best for her. Don't assume, do your homework.

It’s been a few years since I researched this option & things very well might have changed. The financial advisor did tell us to use that option as a last resort. In the end, it wasn’t even a reasonable option as mom’s home was “lower end”.

They do NOT loan you the entire value of the home. Thus, in our situation it would’nt have paid for mom’s care hardly any time at all. That was the deal breaker for us. Her home was already paid for, so we didn’t have to worry about a preexisting mortgage.

You must do some kind of counseling/information meeting with them so you understand what you’re getting into.

There are appraisal fees & the like that are charged. Since we didn’t go any further in the process, I have no idea what they are.

Best of luck to you in trying to figure all this stuff out & deciding how to best proceed.

Also Bogleheads.org

They will usually payoff a smaller mortgage so that they are the only ones to have a lien against the home. Most of them charge 5000 to 10000 upfront plus fees that are part if the mortgage. By doing this interest begins to accrue and compound from day one. You (she) is REQUIRED to pay taxes, house insurance, keep the house in good repair AND reside in the home. If she needs to go to AL, ir any other stipulations or breach occur, they can demand payment in full immediately or they will take the home in foreclosure. Even a lapse of home insurance or a late tax payment can put her in jeopardy of losing her home. New rules and regulations also exist for accessing funds. AARP has quite a bit of information about how it works. When the borrower passes, the mortgage is due in full or the bank will take ownership of the property. Dont forget that all that interest has been compounding and building up until this time. They don't offer this to help out, they do it to make money in the guise of assisting the senior in a time of need. How bad is mom's dementia? Is she cognizant or does she have a financial poa that has been activated? She may not be able to get one if she is not able to make a conscious decision about this situation. Would relocating her to a condo,duplex,or townhome be in her best interests? No maintenance, smaller property,if current home is sold,enough to pay for new residence, current mortgage, and still pay home care? Just an idea. Any way to move in with a child while renting out her home (at a profit to help pay in home care, mortgage, taxes,insurance covered, small excess for basic repairs)?

I have been studying Financial Planning for a couple years. Reverse Mortgages rarely are in the family's best interest.

I am concerned that a 90 year old has a $30,000 mortgage. Why is her house not paid off? My Dad is the same age and has a mortgage, his is due to pi$$ poor money management. He got a mortgage to pay off his credit cards, and has since maxed out a whole raft of new cards.

Why do you feel a nursing home is a depressing option?

I heard they charge $15-$20k in fees. They can.
Do you still own the house? Technically....NO. Because it's a loan that the company would cash in on once your mother dies. Whatever's leftover after they've collected their dues would then be given to your Mom's outstanding debts first, heirs second (if anything is in fact leftover).

Would they pay off her existing mortgage? I don't know but DON'T DO IT. Reverse mortgages are predatory lending on the elderly. There are other ways to get your Mom the care she needs.

A nursing home may have to be considered due to her fall risk alone. Do what is best for your Mom but DO NOT, I repeat DO NOT take out a reverse mortgage on her home. She's still responsible for the annual taxes and insurance on her home as well as the mortgage outstanding on it. What reverse mortgage companies don't tell you is that those two things are not things that they cover or pay for. You'd just be adding more debt onto the pile by taking out a reverse mortgage. Depressing as the prospect is in placing your Mom in a NH, it needs to be considered for her as it would selfish to keep her away from what she needs medically. There's always assisted living. Or the home health carer you've been using as well. See what you can do to pay off your Mom's mortgage without resorting to a reverse mortgage. She needs all the help she can get at this point.

One thing I didn’t see mentioned above is that the required fees you must pay like consultation, closing costs etc etc are all added to the loan and you therefore pay interest on the fees. More money in their pockets - less for you. That’s why they are gaining popularity. 

It is a desperation play for someone who has absolutely no alternative.

Decisions about residential care really need to be made based on the needs of the patient and NOT what their children find depressing.

If your mother is living by herself in a house with a four hour/day caregiver, and her condition requires “more care” than provided in AL, then SHE NEEDS the services of a nursing home.

Her ear needs are what matter as a dependent adult. The emotional responses of her children should NOT be part of the decision making process.

An OBJECTIVE ASSESSMENT of her condition by a trained geriatric professional may be helpful in determining the BEST ANSWER for your mother’s care.

If the goal goal of a reverse mortgage would be to provide the same level of care as she is receiving now, you already know that her needs are not being met by that.

Consider HER NEEDS then address them.

My mother couldn't afford the monthly payments on her home so she did a reverse mortgage. She was able to live there for another 10 years until the house maintenance required more repairs than she could afford. I moved her into my apartment and she let the house go to the bank. No heirs can inherit the home and the home was in need of many repairs so she decided not to sell it. No profit would be made from a sale so now it has been sitting quite awhile empty until HUD decides what to do with it. I think it's best to not do this and sell the home. At least you can keep any money made from the sale. I guess it has both cons and pros.

It’s too late for a reverse mortgage to do your mother any good. When acquiring one is an “act of desperation,” the bank will always be the (big) winner, and guess who loses? The large fee for the transaction is only the beginning. You would be insane to let a 90-year-old do such a thing.

Unless the law has changed since we did this in 2017, there IS a way to “game the system” and make the reverse mortgage actually profitable. My husband and I did just that. When he turned 62 (I am somewhat younger), he took one out on our house (valued at $630,000 by appraisal). But we did not cash in. We are simply letting the available equity sit there, year after year, accumulating interest. If we wait until my husband is 73, the amount available will be over $1,000,000. At that point, we will cash out, and use the profit to get a smaller place, with no huge lawn. The bank will take the house, and sell it for what they can. Their problem, at that point!

I was hugely skeptical, at first; it all seemed fishily too good to be true. But my husband is a real estate lawyer, and he deemed it airtight. If we should need fast money sooner, we could certainly claim it at any point (although we have other assets). If he died before claiming at any point, the deal simply dissolves, and I can sell the house as I normally would, or stay put, as I choose.

If we cash out on his 73rd birthday, and he drops dead the next day, I can take the $$ and either stay in the house (unbelievable, but perfectly legal), or go and fulfill my dream of buying a small place in France or Italy, and grow old there.

Or (ugh) if one or both develop ailments that require full-on, 24/7, expensive fancy care places, well, we will have the money for that.

There really is no downside, in our case. And I recount all this not to gloat, but to advise others who are still relatively young, and have a paid-for house and no immediate need for quick cash, to look into this. Especially if you live in an area where houses are not appreciating in value, and there is some question whether you could make any kind of good money on a sale in the anticipated future market.

But waiting until you are cash-strapped and old is exactly what the bank hopes you’ll do—because then, THEY come away with more.

Shellroc, I am just floored that you are solely motivated by your own personal guilt.

You are willing to force a move to an apartment that will make mom unhappy, but you won't put her in a facility that will ensure her wellbeing and safety so you don't have to feel guilty when she dies.

You need help, that is the most screwed up thing I have ever read. You should let the courts take over for your mom, at least they will give a crap about her and not make it all about their feelings.

I suppose it wouldn't bother you in the least if she choked to death because there was no one there to help her after the caregiver went home for the day. That she is beyond AL care and you find it acceptable for her to live alone 20 hours a day so you don't feel guilty just enrages me. You don't care one iota about your mom.

Why do u feel an AL would not take Mom. My Mom was in the later stages. She needed help bathing, dressing, meds and getting to the dinner table and she was in one at 5k a month. She did well there. Money ran out and I found a nice NH. Which in hind sight we should have put her in instead of the AL. No, they aren't perfect and they aren't home but both took good care of Mom. Your Moms desease is going to worsen and unless one of her children wants to care for her 24/7, decisions will nedd to be made. It becomes its not what you or she wants but what she needs.[

4 hrs a day is not enough care for Mom unless someone is with her the rest of the time. Have you figured what it would cost for 24/7 care in her home. At $10 an hour (this would be private pay, an agency would charge at least $20) that would be $240 a day, 1680 a week, approx 87k a year. Even if you sell her house, the proceeds would be gone in 2 years at least. Better that you sell for Market Value (Medicaid requires this) put the proceeds in an interest bearing account. Find a nice AL for maybe 5k or so a month. Use the proceeds to offset what Moms SS and pension doesn't cover.

Unless a family member is willing to live with Mom, I really don't see how you can keep her in her home. Reversed mortgages work on equity not what a house is worth. So Mom only has maybe 190k to work with. I hated that most of Moms money was going to the upkeep on a house that was getting old and repairs were needed. She could have sold the house 11 yrs before she died. Took the proceeds and put that and Dads insurance money into CDs. She could have gotten a nice apartment and pretty much lived off of her SS and pension. The sale of the house as backup and money for the AL she was eventually in. As it was, the house became a burden to me. In the 4 yrs it was for sale it deteriorated. It sold as is for 40k. Lots less than she could have gotten for it 13 yrs ago.

You as a family need to make decisions now concerning Mom. Dementia can be a slow process or Mom wakes up one morning and its progressed a couple of stages. Better that you place Mom somewhere early so it becomes her home than later when she doesn't adjust as well.

I just wanted to give an update since I’ve had people respond to my question in the last month .

No on the Reverse Mortgage

Since July
Mom still isn’t in assisted living and I can’t force her into one . I don’t have it in me to do it ( guilt) right now. We promised her she’d stay in her house and my brother especially is sticking to that although he does very little to help . He is the golden child who could do no wrong in her eyes and I was always the caretaker. I guess much hasn’t changed !!

I hired 3 caregivers and she seems very happy with them . It’s much less stress for me and she doesn’t call 4-5 times a day anymore .

I guess I’m waiting for the other shoe to drop . I know she’s getting worse and It’s hard for her to find words and complete sentences.I keep thinking I’ll put her in a place when she doesn’t know who I am anymore but I think it will still be hard. I know lots of you have done it and I commend you . You’re braver and tougher than I am .