Never before a main pillar of state aging in place initiatives, a new program launching this week in Minnesota touts reverse mortgages as an important retirement planning tool. Under a Federal Department of Health and Human services partnership coined “Own Your Future,” the program aims to educate and make people aware of options available, reverse mortgages included.
If successful, some program participants hope the education effort could span beyond Minnesota borders to other states across the nation.
“From a national perspective, Own Your Future has been a federal campaign. For Minnesota to be doing this and including reverse mortgages and other options is pretty exciting to the industry,” says Beth Paterson, who sits on the Own Your Future advisory panel for the state along with representatives from AARP, elder law experts and more than two dozen representatives for long term care and aging associations and organizations.
Noting several things to consider about reverse mortgages, the campaign highlights the program’s benefits including the counseling requirement, the fact that a borrower does not lose his or her home, the fact that the borrower and heirs will never have to repay more than the home is worth at the time of sale, and that reverse mortgage payments are not taxable. While there are additional considerations included, reverse mortgages are a viable option, the messaging says.
“A reverse mortgage can pay for both immediate needs, as well as preventive measures, the campaign states. “This allows you to continue to live at home safely and comfortably. Compared to a home equity loan, a reverse mortgage provides many more protections for the homeowner.”
The decision should not be made without careful consideration, it states, but includes laws to protect consumers’ rights.
The messaging has also changed in moving away from the “last resort” mentality of the past, Paterson says.
“They are saying consider reverse mortgage as part of the option, not just waiting to use it as a last resort,” she says.
The program launches Tuesday and will include speaker sessions, community meetings and other awareness initiatives.
Written by Elizabeth Ecker