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Dr. Fiona Chen
Dr. Fiona Chen, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 355
Experience:  Former IRS Revenue Agent
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AM A 74 YR OLD RETIREE. I STARTED WORKING LATE IN LIFE AFTER

Customer Question

HI AM A 74 YR OLD RETIREE. I STARTED WORKING LATE IN LIFE AFTER MY KIDS HAD GROWN UP. I OWN A HOME THAT USE TO BELONG TO MY AUNT, I BOUGHT IT IN 1999. I STARTED WORKING IN 1991 AND HAD TO RETIRE IN 2O10 BECAUSE OF MAJOR SPINAL SURGERY AND AM NOW ON SOCIAL SECURITY WHICH IS ONLY $739.00 A MONTH AFTER MEDICARE DEDUCTIONS. I HAD A 401K WHICH IS GONE NOW TO PAY BILLS. MY MORTGAGE IS $653.00 0F WHICH I AM A MONTH BEHIND NOW BECAUSE I' VE BEEN BATTLEING CANCER THE PAST YEAR. THANK GOD I'M IN REMISSION NOW, BUT THE CHEMO RUINED MY TEETH AND I JUST HAD TO GET THEM ALL EXTRACTED AND GET DENTURES TO THE COST OF $2000, WHICH I BORROWED FROM LIFE INSURANCE. MY QUESTION IS CAN I GET HELP PAYING MY MORTGAGE OR WILL I LOSE MY HOME?
Submitted: 2 months ago.
Category: Finance
Expert:  Dr. Fiona Chen replied 2 months ago.

Hello! My name is***** to JustAnswer. I'm reviewing your question now, and will post back with your reply momentarily.

Expert:  Dr. Fiona Chen replied 2 months ago.

Dear Customer,

Your situation is that your income cannot cover expenses. Fortunately, you still have some 401(k) so that you are not behind on your mortgage payment. Your 401(k) may prevent you from being qualify for Medicaid or other types of assistance. But you still want to try and explore.

1) Do not lose your house.

2) If after you calculate how long your 401(k) can last, you may want to do the following arrangement.

a) Consider reverse mortgage. Reverse mortgage will pay off your mortgage balance, if you are qualified for reverse mortgage.

b) Apply for reverse property tax. Because you are low income, your county may qualify you for reverse property tax, i.e., the property tax is held with a certain interest rate and will be paid after the senior permanently leave the house.

c) Sell the house and move to a more manageable setting such as a small condo or rental. If the equity on your house is high enough, you may be able to move into a senior assistant living place which will later on accept Medicaid after your 401(k) is exhausted.

3) After your 401(k) is used up, you may qualify for supplemental social security income.

Supplemental Security Income (SSI) is a Federal income supplement program funded by general tax revenues (not Social Security taxes):

It is designed to help aged, blind, and disabled people, who have little or no income; and It provides cash to meet basic needs for food, clothing, and shelter.

https://www.ssa.gov/ssi/

4) But the supplemental income amount is not much. Relying that amount to keep the house is a sort of "dangerous".

Most seniors have to face reduction of assets and with limited assets. Reduce our expenses and eventually move onto Medicaid is a very popular way of living among seniors. The battle is to fight time to have our assets last as long as possible.

5) You may want to try to apply for Medicaid now, and see whether you can qualify. Once you can qualify for medicaid, there are many other related benefits you may be able to qualify, such as utility help, etc. to reduce your expenses.

6) Call the local, county Department of Aging and Department of Family and Health Services to see whether you can get any services or help for seniors. Because the income is limited, any reduced expenses are helpful. Also, if you are home bound for a period of time, say recovering from an injury, you may qualify for home care services up to 20 hours a week. Also, if you talk with a social worker or case manager, they may have more insights and knowledge about local resources such as, senior housing, free meals, etc.

7) You can call your county's department of aging to find out whether there is a regional dental office for the low income and whether you can qualify or not.

Please feel free to follow up.

Regards,

Fiona

Fiona Chen, MPA, Ph.D., CPA, ABV, CFF, CITP

Customer: replied 2 months ago.
sorry Fiona, 401k is already exhausted it was only $43,000 and house doesn't have enough equity for reverse mortgage and it needs some repairs. i've already applied for ceda for light and gas so that aspect is covered.
Expert:  Dr. Fiona Chen replied 2 months ago.

Dear Customer,

If you don't mind, how much is the mortgage balance and how much is the market value?

Regards,

Fiona

Expert:  Dr. Fiona Chen replied 2 months ago.

Dear Customer,

It is good in a way that there is no more 401(k).

Please apply for supplemental social security income, medicaid, etc. I don't think if you qualify for medicaid, you still need to pay the medicare premium. Find it out.

Get food stamp and apply for reversed property tax as soon as possible.

If you can still hold on to the house payment, ask for refinance under HARP to reduce principal. Keep on paying the mortgage when you make the application and inquiry.

You may want to consider rent part of the house out. Then, you have income.

Sell the house and get some equity out of it. This is the last alternative.

Have you tried to make inquiry of reversed mortgage? At your age, you may be qualify for a better deal. Inquire again.

Please feel free to follow up.

Regards,

Fiona

Customer: replied 2 months ago.
Cancel the Phone Call request. I dont wanna pay $52 extra for that. Thanks
Expert:  Dr. Fiona Chen replied 2 months ago.

Dear Customer,

I don't see your telephone request now. Contact the customer service if you have a question on the phone call.

Please feel free to continue the posting if you have any further discussions.

Regards,

Fiona