Quote:
Originally Posted by Electrocell
Personally I would rather stay independent as long as possible. Rather die at home then in a nursing home or assisted living place. Both are expensive and with nursing homes (at least in TN) they make you either sell your property to help pay for the care if social security doesn't cover it all. So you have nothing left to give to whomever you want to give it too. If you don't sell it at least 5 years before you go into the nursing home they will go after that money also if you have it in the bank. Then dole out an allowance for you.
Was told some really sad stories about nursing homes in the area I live in by people that actually live in them. Not to mention the smells you smell when you are in them. They are always short staffed and under paid. Around $1500.00 + a month.Assisted living you are looking at $3000.00 + a month.
So I will take my chances at home with my niece coming by and home healthcare help.
A lot of retired people are doing reverse mortgages so they can continue living at home. I own my place free and clear so that might be an option for me if my retirement isn't enough to take care of the bills etc.
|
My Mom and Dad did a reverse mortgage and a living trust well before it was needed to ensure their money supply and minimal death taxes. One of the requirements of a reverse mortgage is that your house must be in good condition, or be made to be in good condition, to qualify for the mortgage. What i mean is paint and repairs mostly, but they can also ask for new carpet etc... Most people do the repairs with the money they receive.
When my folks took out their RM, they had choices as to the type and payout structure. You do NOT pay interest on the money unless you have it disbursed to you. For instance, they took 40,000 out in a lump some, and if they needed more they had a new disbursement done; only the money released to them collected interest, the money in their "fund" did not. The money in their "fund" was available to them anytime with a couple of days notice.
When they passed, only the money they had taken (plus interest) was subtracted from the sale of the house, and the remainder ( nearly 200,000) was disbursed to their trust and then to us, INCOME TAX free! We were also allowed to take the loss on the house from the interest, on our tax returns at $3000 a year each, until it was gone. Which for me was 3-1/2 years!
The other option at the time, was to take a set monthly amount to supplement social security or other pensions. It is a good option for a lower value house, or someone not wanting to travel or buy large ticket items. I'm not certain a large disbursement is possible with this type of RM.