In the previous post, I started to discuss the Adult Protective Services in Ventura county, CA. and being a guest speaker at their staff meeting. In closing that post, I mentioned that in the event that a senior is in the process of a foreclosure, a Reverse mortgage can be used to pay off the existing loan and cancel the foreclosure proceeding and save the home.
It is extremely important for the public and professionals to know of this option, given the current foreclosure crisis at this time. If a senior can’t make their mortgage payment, they have the option of doing the Reverse mortgage, paying off their loan and being able to remain in their home.
About 15 people were at this discussion and given the significance of the day, I felt that it was very important to recognize their commitment to prevent and help seniors and dependent adults from becoming victims of individual terrorism. I congratulated them on their work and compassion and how important their mission is to help the helpless.
As a Reverse loan consultant and representing the Reverse Mortgage industry, I am quite concerned about some individuals who may financially abuse a senior by selling them a Reverse Mortgage and then use the funds from it to purchase unnecessary insurance products or annuities with deferred payments and high surrender fees.
This has occured and I have come across two situations where a senior had done a Reverse mortgage and then purchased this type of an annuity. Purchasing any type of insurance product is not a condition to completing a Reverse mortgage and it is very unfortunate when something like this happens.
A Reverse mortgage is in of itself, a built-in annuity without any prepayment penalties or income taxes and it allows the borrower the ability to access the funds anytime whenever they should need additional money. To use the funds to purchase an annuity simply does not make any sense.
As a Board member of the Ventura County Adult Abuse Prevention Council (VCAAPC) , I have learned quite a bit more about abuse in general and the unfortunate ways that it can occur. Sometimes it is a family member who is the only caregiver to their parent and is overwhelmed by the responsibility and not able to handle the stress or it’s a “trusted” advisor.
And at this time, there are approximately 20 million adult children of seniors throughout the United States who find themselves in this situation, causing enormous emotional stress, physical problems and financial loss.
Funds from a Reverse Mortgage could eliminate this problem and bring relief to the senior and the family members.