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How to be Involved your Parents’ Reverse Mortgage Process

It can be tough to know how and when to get involved with aging parents’ finances. As a general rule, children are taught that asking their elders about money is a major faux pas, and that sentiment doesn’t always go away once we reach adulthood. However, as our parents age, it may become necessary to step in and become involved – at least somewhat – in our parents’ financial matters. But how should you go about it? The first step is to simply open up a dialogue.

Talk about it.

Starting a discussion about money may intimidate or even embarrass some people, especially when the discussion involves parents or parental figures. However, if you are concerned about your parents’ financial well-being, asking a few simple questions shouldn’t hurt. For starters, ask your parents whether or not they want your help. If your parents are adamant about handling their affairs themselves, it may be best to leave it alone. Pushing the issue can result in unnecessary tension and hurt feelings.

If your parents seem receptive to letting you in on some of their financial details, the next question you could ask would be where, how and when they may need your assistance. If your parents are considering a reverse mortgage, ask them if it would be alright if you were involved in the process. And if they are reluctant, or flat out refuse, don’t panic. There is a common misconception among consumers that reverse mortgages can leave heirs financially responsible for the reverse mortgage debt. This isn’t true. While a reverse mortgage borrower’s heirs or estate may be responsible for handling the paperwork and settling the debt legally, no actual debt is passed on to the estate or heirs. In other words, your credit score and financial obligations will not be altered by the reverse mortgage.

However, a reverse mortgage can still impact heirs. For instance, if your parents had planned on leaving the home to you after they passed away, a reverse mortgage could alter those plans considerably. If the reverse mortgage becomes due after your parents’ death, you may find that you need to sell the home in order to pay off the balance of the reverse mortgage.

So, yet another question to raise when discussing a reverse mortgage with your parents should be “what are your plans for the home after you’re gone?”

Talk to the people your parents are working with.

Talk to the people they are working with to make sure you feel comfortable that they are trustworthy, knowledgeable, and have your parents’ best interests at heart. When your parents arrange meetings with reverse mortgage lenders, ask them if they wouldn’t mind you coming along.

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Consider how the decisions they are making impact your own financial future.

Will you need to support your parents financially or provide care in years to come? Are there better ways to structure things now so that they are provided for in the future? These are all questions to not only ask yourself, but to pose to your parents when the time comes. Your parents surely wouldn’t want you to be burdened financially in the future, so if you approach them politely, they may be very open to discussing all the options to see what would work best for everyone involved.

Resources for Seniors and Adult Children of Seniors

Tips for Seniors Working with Contractors
Wilmington NC Aging in Place Resources and Support
Tips for Children of Parents Aging in Place
Safety Tips for Seniors Who Live Alone
Ways to Help Seniors Living at Home Not Feel Isolated
Tips for Making a Home More Accessible to a Senior with Limited Mobility
Budgeting Ideas for Seniors Living on Fixed Incomes
Home Buying Tips for Seniors
Can’t Pay Your Property Taxes or Homeowners Insurance?
How to Better Meet Medical Needs of Seniors at Home

Learn more about how people are using home equity conversion mortgages for purchasing homes:

Please keep in mind that the reverse mortgage industry is 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.