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Many older Americans wish to remain in
their homes, but are finding it extremely
difficult to pay for expenses associated
with a chronic health condition. For some,
using the home equity to pay for health
care can be an important option.
A reverse mortgage is a loan that allows
homeowners age 62 an over to use the equity
in their homes as cash while living at home.
Borrowers continue to hold title to the
property and do not need to make monthly
payments to the lender. Instead, the lender
pays the borrower in one of three ways.
The loan can be in the form of a lump sum,
a line of credit or as monthly payments
until the borrower dies, moves out or sells
the property.
A new study by The National Council on
the Aging (NCOA) shows that using reverse
mortgages to pay for long-term care at home
has real potential in addressing what remains
a serious problem for many older Americans
and their families. Long-term care is the
type of care that you may need if you can
no longer perform "activities of daily
living" by yourself, such as eating,
bathing or getting dressed. It also includes
the kind of care you would need if you had
a severe cognitive impairment like Alzheimer's
disease. Care can be received in a variety
of settings, including your own home.
More than 13.2 million Americans can use
reverse mortgages to pay for long-term care
expenses at home. In this way, many can
stay independent and live in their homes
longer. According to the NCOA, there are
9.8 million seniors over 62 years of age
with a chronic condition and there are a
variety of long-term needs that have to
be met. A reverse mortgage can help supplement
extra income to pay for expenses that arise
on a day-to-day basis. It can be challenging
to manage money when dealing with long-term
illness and a reverse mortgage can help
add flexibility to the family budget.
For more information about long term care
and reverse mortgages:
American
Association of Retired Persons (AARP)
Department
of Housing and Urban Development
National
Council on Aging (NCOA) : Use Your Home
to Stay at Home
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