Investing reverse mortgage funds into a living will may be a “good” use of the loan proceeds and a way to avoid expensive legal battles following the borrower’s death, according to one heir’s letter to The Seattle Times.
Speaking from personal experience, an heir of a reverse mortgage borrower wrote to The Seattle Times about how the loan allowed her father to live in his home for five years with dementia and his two live-in caregivers.
The 82-year-old father, who died just before the housing market crash in 2007, had an estate worth nearly $500,000, leaving his heirs to sell the home during the economic crisis.
The heir’s sister then sued the letter writer for the amount her inheritance fell short because of the home’s lost value, resulting in much of the father’s estate to be swallowed up by attorney fees.
“A good use of reverse mortgage funds would be to invest in a living will, which doesn’t have to go through probate,” the heir wrote in the letter.
Written by Jason Oliva