How Funds Can Be Used for Home Care
It’s been well documented that most seniors haven’t saved enough money for retirement; most notably, because we’re living longer – by between eight to almost 20 years longer on average, according to the World Economic Forum. Faced with the financial insecurity of dwindling nest-eggs, seniors are worrying about being able to stay in their homes as their healthcare needs change. The need for home health care is increasing as more and more seniors choose to age in place; but trying to figure out how to pay for the services can leave seniors with few options. However, for those seniors 62 years of age and older, tapping into their home equity through a Home Equity Conversion Mortgage (HECM), a federally insured reverse mortgage, which can help some seniors pay for home care.
A HECM is a home equity loan, signed into law by the federal government in 1988, that lets senior homeowners who have substantial home equity access funds to supplement their fixed incomes. Borrowers can take a lump sum, set up a line of credit, or as a monthly payment. The homeowner doesn’t have to make payments back to the lender as long as he or she lives in the home. The proceeds from the reverse mortgage can be used for most anything, including paying for home care. Home care tends to be less expensive than assisted living or other senior living communities and often is the most preferred option.
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More on Reverse Mortgages Funding Home Care
Home care, often referred to as home health care, is provided by caregiving professionals and can range in services from assisting seniors with daily living activities including:
- Mobility assistance
- Dispensing medication
- Grocery shopping
This list is not exhaustive, but just an example of the types of assistance that home care provides so seniors can remain in their home while getting help to do so.
Though the reverse mortgage loan does have to be paid back, the homeowner can pay it back whenever they want, when they sell the property, move from the property, or when the homeowner passes away. If you want to age in place and think a reverse mortgage might be right for you, speak with a Certified Reverse Mortgage Professional to see if this program is right for you.
Learn more about how people are using home equity conversion mortgages for purchasing homes:
Please keep in mind that the reverse mortgage industry in constantly changing and some of the information contained on this site may not be current. Please ask a licensed reverse mortgage professional for up-to-date guidelines.