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Finding Security in a Reverse Mortgage | Debbie Daniel

I specialize in reverse mortgages and have assisted many families in determining if this product is right for them. Reverse mortgages can provide great benefits to the homeowner and/or homeowner’s family by relieving them of the monthly obligation and freeing up cash that might be needed elsewhere.  I wanted to share one of my client’s story because it’s a great example of how this product can really help families.

Barbara is an 84 year old widow who was diagnosed with Alzheimer’s disease 5 years ago.  She has 3 children, a 62 year old daughter in Palo Alto, California, a 59 year old son in St. Louis, Missouri and a 57 year old son in Phoenix, Arizona. Since none of her children live close enough to help care for her, they have been paying $4,000 a month for in-home care. Their father had left a $100,000 life insurance policy to help take care of their mother but with normal expenses of running a household and the cost of the in-home care, the savings has rapidly depleted. The family called their attorney in Little Rock to seek counsel on what options were available to them. They did not want to send their mother to a retirement home. Their main objective was to keep their mother in her home so that her life would not be uprooted. The attorney informed the family of two options:  sell the home to an investor and lease it back so their mother could live there or obtain a reverse mortgage. Their attorney suggested they call Delta Trust Mortgage to discuss the option of a reverse mortgage.

I met with Barbara and her family and was informed that her home was worth approximately $125,000 and it was paid for. After considering the closing costs, the net cash available to her with a fixed rate product was $87,975. The FHA maximum loan limit is $625,500, and the principal loan is determined by the borrower’s age and current interest rates. Since Barbara is 84, she qualifies for 70% loan to value (LTV). If she was 65, her LTV would be 60%.

Once the family received this information, I scheduled a conference call to further explain the details of a reverse mortgage and benefits for Barbara. After weighing the options of selling their mother’s home, which would mean realtors showing the house at all hours and potential buyers (strangers to her) coming and going, the children decided on a reverse mortgage. It was a way for Barbara to have additional money to pay for the in-home care without disturbing their mother’s way of life.

For more details about reverse mortgages, click here. You can also watch an interview with me discussing reverse mortgages here.

Debbie Daniel
ddaniel@deltatrustmortgage.com
Phone: 501.225.7703

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