Reverse Mortgage Guide

What to do? We received the note below from a daughter regarding a prospective reverse mortgage borrower.

“Help. My parents are getting ready to do this. My father out of greed. Says he’ll have $500,000 at his disposal. Please advise.”

Peter says:

Family relationships are often complex and difficult. Stepping away from inter-personal issues, there are some questions to ask:

Do your parents have capacity? That is, do they have the ability to independently make decisions for themselves, decisions which they believe are in their best interests? If yes, it’s their property, their asset and their money.

Have they spoken with an independent party, such as an attorney who specializes in elder law? If not, this is a good idea because it will given them a “second opinion” and also allow them to take care of related issues, such as wills and living wills.

Have you and your parents sat down and discussed this idea? For instance, they may feel secure with $500,000 in the bank — and no obligation to repay it from any assets other than their home. Are they going to invest the money? Use it for a particular purpose? Or just get the interest to subsidize their monthly income?

What, exactly, do you think is wrong with their decision? Have you discussed your view with them?

This entry was posted on Monday, November 19th, 2007 at 4:56 am and is filed under Reverse Mortgage . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.