Another Strategy to Pay for Home Care Besides MassHealth: Reverse Mortgages

As I’ve mentioned in previous newsletters, one of my primary goals as an elder law attorney is to help elders reside in their own homes for as long as possible. MassHealth is one such option. Now I’d like to discuss a private-pay strategy: reverse mortgages.

A reverse mortgage is a loan in which a homeowner borrows money against the value of his or her home. These types of mortgages are designed for elders and only available to people 62 years of age or older. The loan can take several forms, including a lump sum, a monthly payment, a line of credit, or a combination of these options. Depending on the type of reverse mortgage one obtains, the money can be used for a variety of purposes, including home care, home repairs, medication, paying off a traditional mortgage, or simply to ensure a reliable income stream.

Federal laws governing reverse mortgages have evolved over the years. Reverse mortgages used to have a bad reputation, for good reason. But now they are well regulated and quite safe. There are also rules increasing protection for non-borrowing spouses—that is, the spouses of individuals with reverse mortgages who are not named in the loan itself.

While there are some risks involved with reverse mortgages, the innumerable benefits of living in one’s own home as opposed to a nursing home make reverse mortgages an excellent option for many elders.

A final word: Please don’t take out a reverse mortgage without speaking with me first. I can explain the benefits and risks of a reverse mortgage and together we can decide if it is a good strategy in your particular situation.

Until next time, take care…