Families often call a care provider before they call anyone else, and the question underneath is usually how to pay for care so a parent can stay home. A reverse mortgage may be one way to turn home equity into money for care, but it has real rules, including what happens if the borrower moves into a care facility for more than 12 months in a row. We explain the options to clients and their families in plain English, with the client's permission, and tell them honestly when it isn't the right fit. We don't pay referral fees or give anything of value for referrals.
Families rarely start by asking about mortgages. They start with "We want Dad to stay home, and we don't know how long we can afford the help."
If you run a home care agency, work as a care manager, or help seniors and their families plan, you hear that question all the time. This page is for you. It explains how a reverse mortgage can sometimes help pay for care at home, where the traps are, and how we work with your clients without stepping on your role.
A HECM lets a homeowner 62 or older borrow against their home's equity, with repayment usually waiting until the home is sold. For families paying for care, three features matter most:
For the full picture, read Paying for In-Home Care With a Reverse Mortgage.
This is the one I most want care providers to understand. A HECM is built for people who live in their home. If the borrower lives in a health care facility, like a nursing home, for more than 12 consecutive months, the loan can come due.
That doesn't mean a short rehab stay is a problem. It means a reverse mortgage works best when the plan is genuinely to stay home with help. If the family expects a move to memory care or skilled nursing soon, a reverse mortgage may not be the right tool, and I'll tell them so.
If the client has a spouse who isn't on the loan and lives in the home, the rules are different. An eligible non-borrowing spouse may be able to stay even after the borrower has been in a care facility for more than 12 months. See the Non-Borrowing Spouse guide.
Reverse mortgage money is a loan, not income. It generally doesn't affect Social Security or Medicare.
Needs-based programs are different. For SSI and Medicaid, money drawn from a reverse mortgage and still in the bank after the month it's received can count toward the resource limit. And giving loan money to family members can create a Medicaid transfer penalty.
If your client gets, or may soon need, Medicaid or SSI, a line of credit with careful draws may work better than a lump sum. A benefits professional or elder law attorney should be part of that conversation. See Will a reverse mortgage affect my Social Security or Medicare?
ZYNG Mortgage doesn't pay referral fees or give anything of value for referrals.
A HECM takes counseling, an appraisal, and underwriting, so it isn't instant. If a family needs money this week, a reverse mortgage won't solve that. If they're planning a few months ahead, it can.
Generally, yes. Loan money can pay for in-home care, home modifications, medical bills, or everyday living costs. We'd rather the family have a plan for it.
The client has to understand the loan and sign for it, and counseling is part of making sure they do. If a family member holds power of attorney, the lender has rules about how that can be used. Bring it up early.
If they're away more than 12 consecutive months, the loan can come due, and the home is usually sold to repay it. Any equity left belongs to the client or their heirs. If an eligible spouse still lives in the home, they may be able to stay.
Not because of the loan alone, as long as the client lives there and meets the loan terms. When the loan comes due, heirs can sell, keep the home by paying it off, or hand it over, and they don't owe more than the home is worth. See Will my family lose their inheritance?
No. We don't pay referral fees or give anything of value for referrals.
If you're working with a family that's wondering about this, call us at 530-888-6000 or book a call. Or share Paying for In-Home Care With a Reverse Mortgage with them first. See also Partner With Us.
ZYNG Mortgage, Inc., NMLS #76801. A reverse mortgage has no required monthly mortgage payments and uses your home's equity. Fees, mortgage insurance and other costs can be added to the loan balance, and the balance grows over time as interest is added, so your equity typically decreases. When the loan becomes due, the home may need to be sold, or the loan repaid from other funds. Interest is not tax-deductible until it is paid, in part or in full. You keep title to your home and must keep paying property taxes, homeowners insurance and upkeep, and meet the other loan terms; not doing so can make the loan due and could lead to foreclosure.
This material is not from HUD or FHA and was not approved by HUD or a government agency.
