DO YOU RECEIVE ASSISTANCE UNDER ANY GOVERNMENT PROGRAMS THAT ARE BASED ON YOUR CURRENT INCOME?
A reverse mortgage does not affect regular Social Security or Medicare benefits. However, reverse mortgage proceeds may affect your benefits if you are on Medicaid or receive Supplemental Security Income (SSI).
Although reverse mortgage loan advances are not considered income, they may affect eligibility for some means-tested benefits. Like, public assistance benefits are only available to people who qualify based on their income and assets. Loan advances retained in a borrower’s bank account may be counted as assets. These are also referred to as “liquid resources” or “reserves.” You should consult a qualified financial advisor to learn how a reverse mortgage could impact the eligibility of some government benefits.
Are you considering a lump sum cash draw?
Getting a lump sum cash draw from a reverse mortgage unless it is immediately spent, could impact a borrower’s eligibility for Medicaid and Supplemental Security Income. Funds that you retain could count as an asset and could affect eligibility. You should contact a qualified financial advisor, the local Area Agency on Aging, or a Medicaid expert to learn more.