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REVERSE MORTGAGES HELP SENIORS TO MEET FINANCIAL NEEDS

©1998 by Steven Pradell

The Alaslka legislature has recently passed a bill which may make it easier for Alaska's seniors to live in financial security by borrowing on the equity already built up in thier homes.

The act, known as HCS CSSB 221(FIN), was approved by the governor on May 28 and will be effective as of August 26, 1998. The new law allows those lending money in Alaska to give a special type of loan, called a reversed mortgatge, to those who have built up equity in thier homes.

This is especially good news for seniors, who may have built up home equity but who do not have liquid funds available to survive. The reverse mortgage concept allows a lender to loan funds using the home equity as collateral. The borrower receives a monthly check from the lender which can be used to pay off living expenses. The borrower need not repay the loan until death or until the home is sold, as long as the home continues to be the primary residence of the borrower. Uneder the new law, A lender can not evict the owner of the property as long as the property tax, hazared or fire insurance premiums are paid, the property is kept in reasonable repair, and the owner has not vacated the property for over one year.

It may be wise to consult with an attorney and a tax specialist who can answer your questions regarding the consequences of marriage or divorce. Many attorneys will consult with potential clients for a nominal fee to answer your questions and define the services they offer.

The Alaska Bar Association can refer you to an attorney who can answer your legal questions regarding your rights.

Steven Pradell is an Anchorage attorney with a practice emphasizing family law, probate and estates, wills and life planning issues. Articles on legal topics of interest to seniors can be accessed on the internet at Http://www.alaska.net/~pradell ©1998 by Steven Pradell. This article is not intended to provide legal advice and should not be relied on for that purpose.

 

 

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