Mom has tenants that pay her PITI but there is not any additional cash flow. Her home is in a rural area that I believe would take years to sell. I'd like to see her have some additional funds as she is stressed monthly even though I do not ask for any contribution from her. Since she is not living there, is a reverse mortgage even an option? We have no in home care at this point but there are some memory issues and I could need help in the future.
The RM can require an appraisal done on the property, so if that happens they will know it is a rental.
Realize that the appraisal or the current tax assessor value will set the value on the property. RM's do not pay the full value. For FHA backed RM, it's about 50% of the value and the borrower has to be able to show the ability to pay for all the required costs on the property…like insurance, taxes for their lifetime. Mom will be expected to pay all this on the property along with maintenance on the property otherwise the RM can call a default on the property. So mom would need to have enough monthly income from SS or other guaranteed source to be able to do this. For FHA backed RM's, she would have to do an "escrow" like account with funds set aside for a period of time to pay for taxes, etc.
If mom has had the property a long time, she may have the insurance at really low value and now will have to have full peril insurance (homeowners, flood, wind, earthquake or whatever in your area) which will be significantly more than she pays now. Plus pay mortgage insurance. That old homeowners policy done 25 years ago that costs $ 300 yr & never updated could easily cost $ 1,500.
You do realize that RM is debt and the debt will have to be fully repaid along with all fees to the mortgage holder in order for family to inherit the property? So if you or other family wanted the place, you will have to pay off the RM to get it.
Perchance does mom have enough medical issues that she could qualify for Medicare hospice benefit? MediCARE hospice can be a godsend for those who still are living in their home or a family members home. Speak with her MD on this.
Hospice could have a caregiver come in 2 - 3 times a week and if they can do her bathing that would be great. Or the hospice provide for a new "breathing" mattress bed or a geri-chair for her to sit in, all stuff frightfully expensive but a hospice benefit that the hospice orders for her through them.
Just as an fyi, mom will have an issue with the property if she later on needs to apply for MedicAID to pay for her care @ a NH or other skilled nursing facility. Rental property is generally viewed as an non-exempt asset and will need to be sold with the proceeds from the sale used towards her "spend-down" before MedicAID will pay. So you might need to do some careful thought as to what you anticipate mom's future care to be…..and if you think she will need to go into a facility rather than stay @ your house for the rest of her life. Ideally you want to be able to sell the property on your own terms rather than having to sell it asap to get her on Medicaid as that is really stressful. Good luck.