Helping Seniors With their Home (Real Estate)

“Helping our Older Generation” – A topic provided to me by Greer Boyce with Fox News.

How do you help the senior in your life who owns real estate?

This topic is something I like to call “Seniornomics”. The economic impact of many common financial decisions is very different for seniors than a majority of the population.

Here are some of my key thoughts:

First, determine the current situation (e.g., is there an outstanding mortgage, can they afford it, do they need additional income)

Second, determine the best case scenario for the future (e.g., the home is out of the parents name for estate tax purposes, cash in the home is used to care for them as they age)

Third, bridge the gap between where you are today and where you want to be in the future by making AND executing plans. This always beats acting in reaction to some triggering event that will likely be filled with lots of emotion.

Some key questions that will determine how you proceed are:

o Is there a potential estate tax issue? (the current exemption amount is 3.5M)

o Will your parent possibly move back into the home?

o Can your parent pay for the assisted living and the home with their current income?

o Are there multiple children involved? (this often creates conflict so its best to workout a plan of action now versus waiting until emotions are very hot)

Reverse Mortgages Hyperbole. Reverse Mortgage are often seen as the “easy” answer to many senior’s financial problems. The most important fact about Reverse Mortgages is that they were designed as a “last resort” for seniors who had troubled credit or income issues that traditional alternatives could not overcome. It’s often the “first resort” many misinformed families take and the risks are serious, expensive, and difficult to reverse.

Below is a video of this presenatation for the local Fox affiliate. Zeus Mortgage Complaints & Reviews (Yahoo)(Google)