Deciding on a reverse mortgage can be challenging, especially when considering objections from adult children. In this chapter, we’ll delve into why adult children might oppose their parents’ reverse mortgage choice.
1. Inheritance Concerns:
Adult children often object to their parents getting a reverse mortgage due to concerns about the impact on their inheritance. A reverse mortgage can increase the loan balance over time, potentially reducing the available equity for heirs.
2. Financial Responsibility:
Adult children may also be concerned about their own financial responsibility if their parents are unable to repay the loan. While the heirs are not personally liable for the loan balance, they may need to sell the home to repay the loan, which can be a difficult process.
3. Loss of Homeownership:
Adult children often cherish the family home and worry about losing it when their parents opt for a reverse mortgage. Although the homeowner maintains ownership, there’s a risk of losing the home if the loan balance surpasses the property’s value.
4. Misconceptions about Reverse Mortgages:
Adult children may also object to their parents getting a reverse mortgage due to misconceptions about the loan. Some may believe that the loan balance will exceed the value of the property or that the lender will take ownership of the property.
5. Lack of Understanding:
Finally, adult children may object to their parents getting a reverse mortgage simply because they do not understand the loan and its potential benefits. In some cases, adult children may be concerned about their parents being taken advantage of by unscrupulous lenders.
It’s important for parents to discuss their plans to obtain a reverse mortgage with their adult children and to address any concerns they may have. This can help to alleviate any misunderstandings or misconceptions about the loan and its potential benefits. In some cases, adult children may need to be reassured that their inheritance is still protected and that the family home will not be lost.