Real Sage Advice

Reverse Mortgage-Is it for you?

One time per month I have the privilge of publishing an article at Gilbert Guide. It may seem strange for a real estate agent to offer an article about reverse mortgages when they are usually used to help seniors stay in their homes. Well, if I can help a senior stay in their home comfortable for a few more months before it's time for them to move, everyone wins. They aren't for everyone, here are some pros and cons of reverse mortgages for you to consider:

Reverse mortgages understandably have their fair share of both advocates and critics. A financial tool to help seniors pay for home improvements, stay in their home, and increase their standard of living, the downside of reverse mortgages is that the cost can be high. I recently met with a family who asked me to help them talk with their aging parent about moving. The senior and her adult children shared with me their concerns about why they thought it was a good time for her to move. The mom—let’s call her Susan—recognized she needed some help with preparing meals and housekeeping, but really wanted to stay at home. The challenge was finding the money and the services to help Susan stay home for as long as possible, and in a way that would meet her daily needs and give her family some peace of mind, knowing that she would be safe. This gave us the opportunity to talk about reverse mortgages.

First, to be eligible, you must be over sixty-two years of age, own your home, and be living in it as your primary residence. The amount you are eligible for depends on your age, interest rates and the value of your home. Most reverse mortgages are set up so the home owner can receive monthly payments.

Advantages

• The reverse mortgage can be set up as a monthly payment, line of credit or a lump sum—whatever works best for the senior.
• No matter how the reverse mortgage is set up, the home owner does not make any monthly payments.
• No monthly payment is due from the home owner unless he or she dies, moves or sells the home. At that time the loan is due in full, plus interest and fees.
• The home owner can receive monthly income from a reverse mortgage as long as he or she lives in the home as a primary residence. A home owner could potentially continue to receive monthly payments even after the loan balance is higher than the amount that the house is worth.
• Neither the home owner nor his or her heirs will ever owe more than the home is worth, no matter how many payments are received or how high the interest rates become.
• It’s fairly easy to qualify for this loan since credit scores and income are not part of the qualification process.

Disadvantages

• The closing costs are high. The senior must pay origination fees that are about double what they are for conventional mortgages and mortgage insurance. The interest rates are adjustable.
• For seniors who depend on Medicaid or other state or federal programs, it’s important to consider if reverse mortgage payments will affect their eligibility.
• The senior is required to attend counseling by an independent HUD counselor prior to receiving a reverse mortgage. These are complex loans and this is a measure of consumer protection.

Possible Alternatives

• A line of equity may be an alternative. There are fewer fees, and the money is available on an as-needed basis, but it requires monthly payments.
• Refinancing the home with a conventional mortgage may save mortgage insurance fees that a reverse mortgage would require. However, this too requires monthly payments.

As a potential consumer of any financial tool, be cautious and seek out accurate information before making a decision. If you are looking for information on reverse mortgages, I suggest you talk with a HUD counselor or someone impartial. Reverse mortgage officers may be prone to selling only the advantages since they get paid when you take out a reverse mortgage. Real estate agents may be prone to selling only the disadvantages of them, as they get paid when you sell your home. Your best bet is to find an impartial advisor such as a financial planner (whose brokerage doesn’t sell reverse mortgages), an elder law attorney or a certified reverse mortgage counselor, all of whom will be able to share practical information to help you make your decision.

Here are a few links of interest to help you get started:

Reverse Mortgage Calculator

Find a HUD Counselor

Find a HUD-Approved Reverse Mortgage Lender

Aging in Place-Building Accessible Homes Paradox

I went to a fair housing for seniors seminar last week at Minneapolis City Hall in celebration of April being designated as fair housing month. Fair Housing month opens the floodgates for one of my favorite rants-lack of universal design in senior housing.

I stomp my feet as I rage-on about how it doesn't cost anymore to raise electrical sockets, lower light switches and increase the size of doorways in homes when you initially build them. But, try to modify an existing home or senior housing community to increase accessibility-if it's even possible--costs at least triple what it would have had it been done in the first place. I usually end my rant with

Our aging population wants to age in place--in their homes. Builders aren't listening to what consumers want.

Then, it hit me. I had one of those experiences when a new idea-a new awareness hits you so hard it feels like you've hit the bottom of the hill on a roller coaster.  One of those ideas where you can FEEL the light bulb go on. Gestalt Psychologists call this an "AHA" moment.

As a society we are uncomfortable with the thought of aging, growing old, becoming disabled. It's no wonder we're uncomfortable with it, look at how we discard our elderly. With the fear of becoming dependent, and no longer viable, we don't want to see household items that remind us that we are aging. 

We even see this in some active adult 55+ communities. There is some disdain for seeing handrails in the hallways, or even seeing residents with walkers. Where there is some subtle discrimination against those who are showing visable signs of living with a disability. The discrimination is not from the owners or professionals, but from others that live in the building!

Here's the AHA. Builders aren't building accessible housing because consumers aren't buying it. We SAY we need it, boomers SAY they want to stay home as long as possible. But, because real estate is a long term investment, young couples in their 30s and 40s aren't thinking about grip bars, and bathrooms large enough for a wheelchair. What self respecting Gen Xer would buy a home with a walk-in shower built for a wheelchair with hand rails? Are we ready to buy a home that throws our own mortality right in our faces?

I've shopped with baby boomers who are looking for one level ramblers that can be adapted, and it's no small feat. Homes built in the 1950's came with bathrooms that are too small, and hallways that are too narrow. It's a major undertaking to remodel these homes.  Great for designers and contractors, not so great for the baby boomer.

Are we saying we want to age in place but are willing to pay three times as much to remodel homes so that we don't have to look at those grab bars or ramps until we need them?

What say you?

You can stay in your home too long

I know I will want to be the one to decide when I move, and where I move. I know the same is true for my clients. When and where they move should be their decision-not their realtor's, not their care managers, and not their child's.

As this video suggests, sometimes our elders stay in their homes a little too long and it becomes a quality of life issue.

These are pictures of a home my husband and I purchased and rehabbed.

The Video

Long Term Care Consultation helps low income seniors stay at home

As a real estate agent who works with seniors, I am often contacted by an adult child who wants their parent to move, but (surprise) the parent isn't quite ready. It may be 6 months to 1 year before the senior moves, and in the mean time services may be needed to keep the senior safe at home. Waiting for six months can be the difference in the senior feeling in control of their own life since they get to move at their own pace.

For lower-income seniors there are government and community resources available to help them stay in their home:

• Elderly Waiver
• Alternative Care Program
• Home Care Services
• Personal Care Assistance

Elderly Waiver (EW)

• Eligibility: age 65 and over, current medical assistance recipient, and qualifies for supportive services.
• Includes: homemaker, home health aide, adult day services, respite care, service coordination, personal care, home delivered meals, lifeline, skilled nursing, special supplies and equipment, and help with housing options. Other services may be available.

Alternative Care Program (AC)

• Eligibility: age 65 and over, eligible financially, and qualifies for supportive services.
• May require a monthly premium.
• Includes: homemaker, home health aide, adult day services, respite care, service coordination, personal care, home delivered meals, lifeline, skilled nursing, special supplies and equipment, and help with housing options. Other services may be available.

Home Care Services

• Eligibility: persons with disabilities and special health care needs who qualify for Medical Assistance; some recipients of MinnesotaCare may also qualify.
• Includes: professional nursing services, occupational therapy, physical therapy, and other services

Personal Care Assistance (PCA)

• Eligibility: current medical assistance recipient, and qualifies for supportive services.
• Includes: help with activities of daily living, such as eating, bathing, dressing, and personal hygiene.

To gain access to these programs, it is necessary to have a Long Term Care Consultation.

What is a Long Term Care Consultation?
A Long Term Care Consultation (LTCC) can help people make decisions about long-term care needs. This is a service provided by the County in which the senior lives, usually free of charge. This service helps people stay in their homes and receive help through government and community based services.

• Long-term care consultants help people choose services and supports that meet the needs of the individual and their family. 
• A Long Term Care Consultation incorporates the expertise of both social workers and public health nurses.
• A face-to-face meeting may be required to set up services, but a phone call with one of our Long Term Care staff can help you learn about what is available.

What is included in a Long Term Care Consultation?
The LTCC assesses an individual’s health status and level of independence in key areas of daily living.  The LTCC can also include:

• information about local long-term care options
• information about public and private programs that can provide services
• pre-admission screening prior to nursing home admission
• transition assistance to relocate people currently in nursing facilities
• assessment and support planning for people considering community-based services

For more information about a Long Term Care Consultation, here are the websites of the area counties in Minnesota:

• Ramsey County
• Dakota County
• Carver County
• Anoka County
• Hennepin County
• Washington County

Then, when you are ready to move, here's an article on affordable senior housing

Seniors stay at home with NORCs

I'm working with a young couple-Shelly and Sam- who is buying their mother's home. It's the home Shelly grew up in, and it's the home she plans to be in for the rest of her life. She told me "My children will have to carry me out of here!" Unfortunately for many seniors, this is the extent of their planning. They white knuckle their way from day to day all the while not knowing of community services that exist to help them STAY in their homes.

A Naturally Occuring Retirement Community (NORC)  is a neighborhood or community where seniors work together to stay in their homes and age as neighbors. Imagine a block consisting of the original homeowners that have organized weekly transportation to the grocer, pharmacy, doctor, and community events. A group of people who look out for each other.  Sounds like a hybrid of a community action group and an intentional community such as cohousing.

St. Louis Park, Minnesota is a pioneer. They have been working with the Administration on Aging to form a NORC group they have called Nurturing our Retired Citizens. They have formed parish nursing programs, senior resource directories, and a newsletter.

If you aren't able to find senior community resources in your area, reach out and ask. The Twin Cities has a vibrant community of senior professionals that network with each other on a weekly basis.  If you can't find the resource you're looking for, chances are there is someone in the senior profession who can point you in the right direction. 

Minnesota Senior Linkage Line

I promised I would start including resources for seniors in Minnesota to continue living in their homes for as long as possible. If you've cared for an aging loved one, you know how impossible it can feel to get answers to your questions about housing and healthcare (when you're aging the two are inter-connected).  The first resource I'll encourage you to keep in YOUR Golden Rolodex is the Senior Linkage Line. They provide information on in-home care, caregiver planning, support and training; medicare, prescription drug options for all ages, long-term care insurance, and forms assistance. It's no surprise that 56% of threir calls in 2005 where regarding presrciption drug assistance with the debacle of Part D.  In 2005 they answered over 7,000 calls PER WEEK!  They've even referred a few callers to me for the Cells for Seniors Program. Add the Senior Linkage Line to your list of resources for seniors!

Senior Linkage Line
1-800-333-2433
www.MinnesotaHelp.info

Seniors stay at home

I had a conversation with a fellow REALTOR(R) about offering resources to Seniors to help them stay at home (he had read my Cells for Seniors article). This post is for him:

How odd that a REALTOR would help someone NOT move!

I hear this all the time. Why would I do this? It's simple, really. Real estate is a service industry. My job is to have both the knowledge or resources to help people reach their real estate goals. Tell me the why, how, when, where, and what you want to move and I'll get you there.  In the senior housing and senior healthcare arena,  finding accurate, helpful, timely information is like playing the shell game (which is crazy because the twin cities has an abundance of really exceptional senior services) -- at a time when you and your family feel the most vulnerable is when it's the most important to have good information.  If I can be a resource for a family when they need help, what do you think the chances are that they'll call me when they need real estate services? If history repeats itself, and it usually does, I can tell you the chances are more often than not!

To put my money where my mouth is, I'm starting a new category for this blog: Resources to help Seniors stay put.

Your home is your castle, or your prison

To own a home is the American dream.  For the Silent Generation to have paid off a mortgage and own a home out right is an accomplishment to be proud of.  Your home is your castle, your badge of honor.  Your home says to the world that you have provided for your family and you're successful. After a significant portion of your lifetime in one house, it's also your sense of identity and sense of belonging to a community.  In our homes we are the masters of our domain.  To think about moving is to admit you're getting older, you can no longer take care of the house, and perhaps, even need help.  To the "greatest generation" this is an awfully large pill to swallow.

Instead of asking our Seniors to go to the services, what if we brought the services to the senior?  What if we helped them maintain that sense of pride and dignity?  (I think this idea might make a legislatures head explode. How would laws be passed to protect Seniors? Did you know the only industry legislated more heavily than nursing homes is nuclear plants?  I digress.) What if, instead of segregating and institutionalizing, we nurtured and supported our seniors right in their own home?

The challenge is planning ahead, and most of us aren't very good at that.

  Here is yet another opportunity for me to encourage you to plan ahead.  Don't procrastinate. If you'd like to stay in your home indefinately, start thinking about changes you can make now that will make staying in your home easier-now.  Perhaps grab bars in the shower or near the toilet, landscaping your front lawn to get rid of steps, adding a place to sit in your bathroom while you get ready, maybe even a place to sit in the shower?

These types of universal design ideas can keep you in your home longer if they are implemented prior to a crisis.  Trying to implement changes in your home after a fall, or financial problems creates an entirely new set of challenges, and frankly, much less likely you'll be successful in staying in your home.

Making your home physically comfortable, and adaptable to your needs at the time will be one step toward helping you stay in your home for as long as possible. Systems that provide for nutritional, spiritual, social emotional and mental health needs will keep your home from becoming your prison. 

Technology will help seniors stay home longer

It's no surprise that more and more studies are showing that Boomers want to stay at home as they age or "age in place".  Watch this short video on a new monitoring system that helped this senior stay at home, and his family to monitor his safety and health without being "helicopter children".