They have adult children who would like to buy the farm if the parents will hold the mortgage. I have doubts that they could/would keep up payments to their parents.Is a reverse mortgage a good idea for elderly friends?
If their children can not help them with their expenses, then a reverse mortgage help them. They would receive monthly payments until both of them pass away. The property would then either be sold, and the remaining amount go to their heirs, or their heirs can payoff whatever the balance of the mortgage was at the time.
Some children of the elderly object to this because they feel like they are going to ';get'; less, but this is not about them - it is about their parents not being able to survive on their meager retirement income.
I personally have not done one of these loans, but I think it is a great way for seniors who are cash-poor, but home equity rich to increase their income without worrying about paying it back.
Good luck.Is a reverse mortgage a good idea for elderly friends?
If they want to remain in the home then I think it would be a good option for them. The only downside is they would be eating away at equity and there goes the children's inheritence. But that's better than ';selling'; the house to them and then not receive the monthly payments from their kids- what would they do then- foreclose on their kids??
go for it - and tell the kids they'll get whatever is left when the parents pass on - why shouldn't the parents enjoy their golden years? It's their hard earned equity - let them use it! I've told my kids I am living and they get whats left when I'm gone - whatever it may be :)
yes --but they must pacell out the house and an acre or two since FHA does not insure working farms
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