March 2014

More on Medi-Cal

In my previous post, I was sharing a resource for Medi-Cal information if someone needs additional help in caring for a loved one and doesn’t have medical insurance or savings to cover the costs of care.

Plus, another option is to apply for a Reverse loan if the homeowner is at least age 62.   This way they can utilize the money they would receive from a Reverse mortgage to pay for their care and medical expenses.

The Title stays in their name, the Lender never takes over the property and it goes to the estate  (heirs) when the last borrower “leaves” the property.   Plus they will have the benefit of a mortgage tax deduction when the heirs pay off the loan by refinancing the property or selling it.

But I digress.   Here is the remainder of the article that I partially shared in the previous post.

“My firm, the Estate Planning Law Center, is dedicated to helping families who are overwhelmed or confused by all the decisions they have to make when they have a loved one in or about to enter a nursing home. If your situation is similar, we can help with little-known strategies that can protect you and your family.

It’s never too late! If your spouse or loved one is in a nursing home, with the right tools, and using my knowledge of the law and strategies that have been successful in the past, we may be able to…

•    Reduce or even eliminate your nursing home bills;
•    Protect your lifesavings and financial security;
•    Increase the amount of income you get to keep;
•    And safely pass on an inheritance to your children.

I can explain some of the strategies that smart families use to protect their loved ones right now. If you would like to discuss how this type of planning might benefit you more specifically and in greater detail, please give me a call. I’ll be happy to answer any questions you might have.”

Richard M. Seff                                     818-292-8160

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Overwhelmed With Medical Costs?

Most families are unprepared for the costs of aging and didn’t have the foresight to purchase Long Term Care insurance and are totally unprepared to handle all of the medical costs they will experience as a parent ages and needs additional medical care.

Along with the stress of possibly being a caregiver, is the additional stress of dealing with the Doctors and all of the associated costs they charge and possibly enormous hospital charges as well.

Funds from a Reverse loan can certainly help them, especially if they don’t currently have a mortgage on the property or if they do, it’s quite small.

Medi-Cal might be a solution for them if they live in California but they have to locate an Elder Law attorney who specializes in this particular area, who can help a family navigate the intricate process of applying for the insurance.   I am going to provide a copy of an article by Richard M. Seff who provides this specialized service for families.

“Is a loved one in a nursing home? Are you contemplating financial assistance but afraid of potentially losing what you worked so hard to gain? Do you sometimes struggle, feel overwhelmed, frustrated and confused? There’s hope…

You May Be Able to Obtain Medi-Cal to Cover the Growing Costs of Caring for Aging Loved One.

We know the little-known strategies that may save you from needless heartaches, protect your family’s financial security and prevent the potential loss of any hard-earned assets…including your lifesavings.

The decision to move a family member or loved one into a nursing home is one of the toughest and most difficult decisions you can ever make. Over time, caring for an aging or disabled loved one can seriously deplete your energy, your time and, of course, your bank account. ( I see it all too often in my elder-law practice!)

If you don’t know your rights and the different steps you can take right now, that difficulty can expand drastically.  For example…

•    Your nursing home bills can snowball out of control;
•    Your entire lifesavings can be drained if left unprotected;
•    Your income and standard of living can be seriously threatened

•    And in some cases your family home and other hard-earned assets can be lost.”

Richard Seff

Estate Planning Lawyer


I will share the remainder of his article in the next post.


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Safety Net Funds

Here is the last portion of an article I have shared in my two previous posts, regarding how Reverse loans are becoming accepted as a way to extend retirements funds.

In the previous post, I discussed the recent changes to the federally insured loan program, more options and the reduction in fees.  They are safer than ever, provide necessary funds as needed and can extend the life of a retirement fund by not drawing down on it.

Here is the rest of the article

MarketWatch: Will Reverse Mortgages Grow in Popularity?

Posted By Alyssa Gerace On December 17, 2013 @ 4:35 pm In News,Reverse Mortgage

“Over the past year or two, a few articles have been published in the Journal of Financial Planning and other professional publications suggesting that reverse mortgages have a place in a comprehensive approach to personal financial management for retirees,” Peter Bell, CEO of the National Reverse Mortgage Lenders Association, told MarketWatch. “There are a few different approaches advocated by different planners, but essentially they all boil down to strategies to preserve the duration of assets through retirement.”

In 2013, nearly 60,100 reverse mortgages were originated, according to FHA data [2]. “But while retirees may currently know only one person with a reverse mortgage today,” says MarketWatch, “there may come a time when they know 20.”

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Retirement with a Reverse Mortgage

As Imentioned in the previous post, the costs for doing a Reverse loan have dropped and there are more options and choices on the various mortgage options.

The perception of the loan as being that of a “last resort” has changed because the public and professionals are better educated and make the time to seek out the correct information on the FHA loan program.

Here is a copy of the next portion of the article with the remainder to be in my next post.

MarketWatch: Will Reverse Mortgages Grow in Popularity?

Posted By Alyssa Gerace On December 17, 2013 @ 4:35 pm In News,Reverse Mortgage
“Some homeowners may be forced to reshape their opinions on reverse mortgages,” says the article. “As people live longer due to medical advances, more of them may need to get at their home equity to pay for their medical costs.”

Another factor: Many older Americans have significant wealth in the form of home equity, MarketWatch continues, and low- and middle-income households are especially likely to have their wealth concentrated in their homes.

“It’s a tremendous safety net. People today who would tell you they’d never want to use [a reverse mortgage]; 10 years from now, some will have to use it,” O’Hara said.

While the product could be increasingly used as a retirement safety, some say it could also grow as a strategic retirement planning tool.

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Extending Retirement Funds

The image of a Reverse loan as one to be used as a very “last resort”, is changing.   Many financial planners are beginning to see the benefit of including a Reverse loan in a client’s retirement plan as a way to extend their portfolio.

With all of the recent changes to the federally insured loan program and the newest options and more protection, the loan has become an excellent option for many people needing additional money and as a way to fund their longevity into the future.

And along with the new Fixed Rate Line of Credit, closing costs have also been reduced and they are no longer as expensive as they were in the past.

Tthe Mortgage Insurance Premium paid to FHA, has dropped from 2.00 %, to .50% as long as the borrower doesn’t exceed the 60% ceiling on the amount of the loan they qualify for as a borrower.  And in some situations, a Lender Credit can be given to the borrower, further reducing the amount needed to fund and close a loan.

Following is a summary of an article that was recently published, discussing the change in the point of view, historically held by the public and professionals.

MarketWatch: Will Reverse Mortgages Grow in Popularity?

Posted By Alyssa Gerace On December 17, 2013 @ 4:35 pm In News,Reverse Mortgage | No Comments

“Reverse mortgages are poised to become a more mainstream financial product in the coming years, with some industry stakeholders expecting a rise in popularity as consumer attitudes shift, says a recent MarketWatch article [1].

Currently, reverse mortgages aren’t popular among clients of Northbrook, Ill.-based financial advisor Steve O’Hara. That’s due in large part to people’s desire to hold onto their housing equity and a common view of the product as a “loan of last resort.”

“If you go up to almost anyone and say ‘Would you or your parents use a reverse mortgage,’ the average senior or heir would say ‘That’s not for me, that’s for someone in a crisis situation,’” Colin Cushman, chief executive of Generation Mortgage, told MarketWatch.
But that may change moving forward—perhaps out of necessity.”

I will share the remaining portion of this article in the next post here on this site.


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