California Reverse Mortgages Helping Seniors Stay at Home

By: Luke Helm

When asked about the most important issue facing them during retirement, the overwhelming response of many senior citizens is: “I want to remain independent in my home." ?A National Council on Aging study confirms that 95% of the population aged 65 and above share this sentiment.

Reflect on this statement for a moment and you will realize that one of the major underlying requirements for seniors to remain independent in their home is the finances means to cover the related costs. If the senior’s health needs increase, it is likely that they will be faced with many new expenses. The senior may need extra funds to make their Medicare co-payments, pay for prescription drug costs, make changes to their home to improve their mobility, or to hire an in-home caretaker.

There are so many services available to meet the needs of seniors today, they need only be able to afford those that they need in order to stay independent in their homes. In California, reverse mortgages may be the answer, where seniors often have plenty of equity but may have little in the way of savings to meet monthly expenses.

The desirability of California as a place to call home and resulting real estate values gives California residents a unique advantage.? Seniors in California have more equity to tap into with a reverse mortgage than the vast majority of seniors in other states. ?Seniors who have owned their homes for at least 10 years are likely to have a home that is worth far more than what they originally paid for it.? As long as they did not cash out a significant portion of their equity through a home mortgage refinance transaction, then they ought to have plenty of equity to make a reverse mortgage possible.

Since reverse mortgages do not require any monthly payments, the money that the senior receives from the lender does not create any new financial obligations. The lender actually guarantees that the senior will not have to repay the money for as long as they reside in the home, maintain it in basic livable condition, and pay their insurance and property taxes. With these benefits, it is clear that can contribute tremendously to the ability of seniors to remain independent in their homes.

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