Missoula, MT (KGVO-AM News) - With property taxes soaring along with the overall cost of living, Montana senior citizens are finding themselves falling farther behind every day.

The Montana Department of Commerce has a new tool to help seniors stay in their homes and use their equity for necessary expenses.

I spoke with Cheryl Cohen, Division Administrator with the Montana Department of Commerce on Thursday about the 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,” began Cohen. “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.”

The State Department of Commerce offers a Reverse Annuity Mortgage Program

Cohen acknowledged the fact that some reverse annuity mortgage programs are indeed scams, but not this program administered through the Department of Commerce.

“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.”

There are some Income Limits Based on Household Size

Cohen detailed some of the financial details to be eligible for the program.

“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.”

Cohen said she was able to put one family at ease that was concerned about their loved one applying for the RAM program.

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Cohen put One Family at Ease over the RAM Program

“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.”

One important fact to remember about a reverse mortgage is that the loan will be repaid when the homeowner sells their home, moves out, or dies.

Click here to find out more details about the Montana Department of Commerce Reverse Annuity Mortgage Program.

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