Reverse Mortgage or family loan?

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Reverse Mortgage or family loan?

Post by Archman65 »

Scenario: 86 year old MIL in good health is widowed. Has no $ other than monthly SS. Has about $600K in equity in paid off home. Was thinking about a “family loan” but concerned that if I loan her money and she ever needs nursing home the house would have to get sold to pay for her care and my loan dismissed. Reverse mortgage is the only other option but that definitely has upfront fees. (Basically you start with $20K in debt to bank). If I loaned funds it would hopefully eventually be repaid with modest interest upon her passing. Appreciate any advice or suggestions.
Broken Man 1999
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Re: Reverse Mortgage or family loan?

Post by Broken Man 1999 »

Any chance of her downsizing?

Maybe a modest apartment or condo might work.

I believe living in a home with a reverse mortgage is a requirement. So her going to a nursing home might trigger a requirement to sell.

You might see if there are senior rent-subsidized apartments available.

Broken Man 1999
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Re: Reverse Mortgage or family loan?

Post by Nate79 »

I think you should talk to an elder care attorney or estate attorney since you don't know what you are doing.
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