Reverse Mortgages and Health Care Expenses

When you borrow with a reverse mortgage you can use the money for any purpose. Many seniors use reverse loan proceeds to help pay for medical costs. Here’s what you need to know about paying for health care with a reverse home mortgage.

What Is a Reverse Mortgage?

A reverse loan allows you to convert home equity into cash. The money is paid as a lump sum, in installments, or as a line of credit. The money does not have to be repaid until you move out of your home or die. Borrowing money does not mean that a reverse mortgage lender owns your home. The title remains in your name.

What About Social Security?

Unless you have carefully saved for retirement, you may be planning to rely on Social Security. But there is a high probability that Social Security checks won’t cover all your living expenses, especially if you end up with a medical condition that requires expensive care. Just paying for medications can drain your wallet, even if you don’t factor in the cost of doctors visits or hospital stays.

Keeping Your Independence

For some people having enough money to pay for their needs during retirement years is the key to remaining independent. Not only can reverse loan proceeds help pay for medical treatment, but the money also can be used to make modifications to your home or pay for household help, transportation, or other services you might need.

Get Expert Advice

A reverse mortgage counselor can review your expenses and help determine whether a reverse loan might fit into your financial goals. There are pros and cons of reverse mortgages so find someone who can discuss the good and the bad of borrowing money. A reverse loan counselor also should discuss alternatives to borrowing money.

This entry was posted on Wednesday, May 26th, 2010 at 3:21 pm 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.