Missoula, MT (KreditSanta News) – In response to increasing property taxes and the rising cost of living, Montana senior citizens are struggling to keep up with their expenses. To address this issue, the Montana Department of Commerce has launched a new initiative designed to help seniors utilize their home equity for essential costs.
Cheryl Cohen, Division Administrator with the Montana Department of Commerce, spoke with us on Thursday about the newly introduced Reverse Annuity Mortgage Program.
“The Montana Department of Commerce announced yesterday that we have a Reverse Annuity Mortgage Program that they administer through the Montana Board of Housing,” Cohen explained. “We have more than $2 million of funding available for income-eligible senior homeowners. What a RAM (Reverse Annuity Mortgage) loan does for borrowers over 68 years old is that it can provide the borrower with some money back each year or each month to help them cover those additional expenses.”
Safe and Reliable Financial Assistance for Seniors
Cohen addressed common concerns about the legitimacy of reverse annuity mortgage programs, reassuring that this state-administered program is safe and beneficial.
“I know a lot of people hear the term ‘reverse annuity mortgage’ and they think, 'Oh, this could be a scam' and sometimes they are scams,” she said. “However, our program is not and it ensures that the homeowner stays on the title. In addition, they don't have any really high interest rates or inappropriate or exorbitant upfront fees. It's just a stable program that helps senior homeowners stay in their homes comfortably in their golden years.”
Income Eligibility and Counseling Requirements
To qualify for the program, certain income limits are in place based on household size, as Cohen elaborated.
“To be eligible for the RAM program, we have income limits based on household size,” she said. “For a single-person household, the income limit is currently $30,120 a year. For a two-person household, it's just over $40,000 a year. The program also requires that the homeowner participate in our homeowner counseling program. We want to make sure that homeowners who are signing up for the RAM program are aware of the program requirements and they know what the program entails.”
Positive Impact on Families
Cohen shared a reassuring story about a family who initially had reservations about the RAM program but later saw its benefits.
“We did have one of the family members of our borrowers say that when they first found out that their father wanted to apply, they were really upset,” she said. “They thought it was a scam and that they were going to get cheated. And then after they saw it over the two years in operations they were getting monthly payments back and it was helping her father stay independent and maintain his home with dignity. She was really glad that she couldn't have been more wrong.”
Key Facts About the Reverse Annuity Mortgage Program
It's important for homeowners to remember that the loan will be repaid when the homeowner sells their home, moves out, or passes away. The program is designed to offer financial stability and peace of mind to Montana’s seniors, ensuring they can live comfortably and maintain their independence.
For more information about the Reverse Annuity Mortgage Program and how to apply, visit the Montana Department of Commerce or contact their office directly.