What Happens to My Reverse Mortgage if I Become Ill?
Tips to help you decide whether a reverse mortgage is right for you.
Many people over the age of 62 are taking advantage of the reverse mortgage program. This program, sponsored by the federal government, allows senior homeowners to receive a monthly loan payment as long as they live in their home. The loan does not need to be paid back until they move out of the home or pass away. With a reverse mortgage, seniors can put a little extra money in their pockets each month; in most cases, their heirs deal with the obligation after the senior’s death.
A REVERSE MORTGAGE TIES YOU TO THE HOME
The biggest problem with a reverse mortgage is lack of freedom. Seniors cannot move out of the home for any reason unless they or their families are prepared to pay the loan back. There is no exception to this requirement for moves related to serious illness.
HEALTH CONCERNS ARE UNPREDICTABLE
At 62, many seniors are still active, healthy participants in society. For this reason, many do not expect failing health to be a problem. Unfortunately, health problems are impossible to predict, and twenty or thirty years down the road seniors may no longer be able to live independently. At this point, the senior citizen has built up a large amount of debt that will be difficult to pay back.
HEIRS ARE BURDENED WITH THE DEBT
Most of the time, it falls to the heirs to pay back the debt, as a seriously ill senior lacks the capacity to do so. Even if the senior citizen never faces terminal illness, her heirs will have to deal with the debt eventually. Most of the time, heirs are forced to sell the house in order to pay the debt back. In order to keep the house, they must be able to fully pay off the debt within one year of their loved one’s death.
Related posts
- Are There Any Risks Of Taking Out A Reverse Mortgage?
- What Happens to My Home When I Die If I Have a Reverse Mortgage?
- Who Owns My House If I Have a Reverse Mortgage?
- Will I Still Continue to Own My Home If I Take Out a Reverse Mortgage?
- When is the Reverse Mortgage Due and When Is It Payable?
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I have a reverse mortgage and have withdrawn all the money due me. I became ill and had to move to be near my daughters. I have put my house up for sale but it is not worth as much as I owe. What happens now? Do I have to sell it as a short sale? What if the house does not sell for what I owe? Do I have to pay the difference? I do not have any money, do I have to make payments out of my social security?