How They Work and What Happens When You Combine Them By GREG DAUGHERTY Updated December 20, 2022 Reviewed by DORETHA CLEMON Fact checked by SUZANNE KVILHAUG A reverse mortgage allows you to access a portion of your home equity while you are still living there.
If you put that house in an irrevocable trust, you might be able to avoid paying estate taxes when you die and get Medicaid benefits more easily if you ever have to live in a nursing home.
Let’s examine the operation of irrevocable trusts, reverse mortgages, and reverse mortgages combined.
Key Takeaways With a reverse mortgage, people over the age of 62 can access some of their home equity without having to sell it.
A way to avoid paying estate taxes on assets like a home is to use irrevocable trusts. Additionally, they may facilitate eligibility for Medicaid benefits.
Both irrevocable trusts and reverse mortgages can be expensive and have other drawbacks.
Although this is unlikely to be beneficial for the majority of people, a home with a reverse mortgage can be held in an irrevocable trust.
