A recent article that was published in the New York Times, discussed how sometimes the adult children (supposedly “grown up”), children of seniors, become worried about receiving their “inheritance” if their parents decide to use a Reverse loan to fund their retirement years.
Personally in my 12 years of being a Reverse Loan Consultant, I have only encountered this a couple of times, but never directly. Sadly, it’s a question of poor communication between the parents and their children and in general the “kids” have no idea about how a Reverse loan works and the benefits that it provides to allow older people to age in place.
I actually had a situation, where a women was referred to me who has very difficult circumstances and very little income to live. Her home is paid off and a Reverse loan would allow her to have peace of mind and be free of fear and anxiety about how she was going to manage to live, pay her bills and buy food.
And you know what her son said to her when he found out that she was going to look into a Reverse loan? He told her he would “disown” her. Awful, isn’t it? And he’s doing nothing to help his Mother.
Here is a summary of the article that was published, discussing this situation.
“NY Times: Inheritance Blinds Heirs to Reverse Mortgage Realities
Posted By Jason Oliva On April 13, 2014 @ 4:06 pm In News,Reverse Mortgage | No Comments
Even though an entire family may be involved in the discussion of whether to obtain a reverse mortgage, experts find that heirs of prospective borrowers are more concerned about losing their “presumed” inheritance than learning about the terms of the loan, reports The New York Times .
Elder law and reverse mortgage experts in the article say they frequently encounter instances where the adult children of potential reverse mortgage borrowers are “openly opposed” to the idea of their parents spending away their inheritance.
“A lack of communication can lead to a rude awakening for adult children who still live at home and don’t realize what a reverse mortgage will mean after their parents die,” said Deborah S. Ball, a New York elder law lawyer, in the article.
Frank Melia, a mortgage planning specialist with United Northern Mortgage Bankers in Levittown, N.Y. told The New York Times that he has noticed more adult children open to the discussion of their parents borrowing against their home equity since the recession.
But the same statement continues to come up, he says, of adult children telling their parents: “You’re spending my inheritance.”
“Sometimes there’s just no getting through to them,” he said in the article, “because they’re just being selfish about their inheritance possibility.”’
Written by Jason Oliva