Boston Estate Planning and Probate Lawyer & Attorney : Gosselin & Associates Law Firm : Serving Boston, Winchester, Hingham, Wellesley, Manchester

Today, several of the new skin products being marketed tout that they can reverse the signs of aging. They make claims that they can remove wrinkles or increase energy or improve memory. I don't know if any of these products can deliver on their claims. But for seniors 62-years-old or older who own (or almost own) the home they live in, there is a way to reverse one thing in their lives, the mortgage on their homes.

How? In a typical mortgage, a home owner pays the bank a monthly amortized amount. In a reverse mortgage, a home owner pays the bank a monthly amortized amount. Does this sound too good to be true? Is this another anti-aging product gimmick? It's not. For many seniors, a reverse mortgage is a sound financial planning tool, and according to Brett Kirkpatrick of Mortgage Financial Services , "A reverse mortgage might be the ideal option for seniors to maintain their financial independence."

Some Reverse Mortgage History

Reverse mortgages have been available in the United States since 1961 but with considerable variation from one region of the country to another. In 1991 the Federal government expanded its insurance of reverse mortgages, thereby increasing availability across the map. With the rising cost of healthcare, unanticipated increases in inflation, pension plans going under and the unpredictable nature of Social Security, more seniors are looking towards their houses for the cash they need.

In fact, as property values have risen, a number of seniors who took out reverse mortgage loans years ago are returning for second and even third reverse mortgages to harvest the additional equity that has built up in their homes. "Most senior homeowners just want to remain comfortable in their own home." states Ed Barrett, a reverse mortgage expert from Your Home for Life in Westwood, Mass. "With the rising costs of everything today, that is becoming harder and harder to do. Now, with the federally insured reverse mortgage, there is a new option available that really provides for financial security and peace of mind. It really can be 'Your Home For Life'." According to the Federal Housing Administration, which insures most reverse mortgages, by September of 2005, homeowners had taken out about 43,000 reverse mortgages, up from about 37,800 the year before and from 7,700 in 2001. The demand continues to rise with 56% more loans taken out in the first quarter of 2006 than in 2005.

The Ins & Outs of Reverse Mortgages

To qualify for a reverse mortgage, at least one person on the home's title must be 62 years old, the home must be the owner's primary residence (i.e., the homeowner must actually live in the home) and the home must be owned outright or the reverse mortgage loan must be used to pay off the outstanding mortgage balance.

The Federal reverse mortgage loan program has a cap on the size of the mortgage loan it provides, so for those seeking amounts in excess of the Federal limits, state programs and private lenders are a better choice. For both Federal and state programs, there may be restrictions on the types of residences that qualify. For example, under the Federal program condos are eligible, but shareholder-owned cooperatives are not. In Massachusetts, SFR, MFR (1-4 units), Condo's, and HUD-approved manufactured housing are all eligible. Loans generally are written for no more than one-half to two-thirds the value of a home and even if the value of the home changes while the loan is outstanding, the borrower only owes the amount of the loan. The repayment amount can never exceed the value of the home. In fact, under the Federal program, the government makes up the deficiency, if any, to the lending institution, and while Private Placement programs are not insured, all are "non-recourse".

The borrower decides how to receive the loan money. There are four payment options: (1) an up-front lump sum payment; (2) a line of credit; (3) fixed monthly payments; and (4) a combination of a line of credit and fixed monthly payments. With any of these options there are fees and costs, but many of these are the same fees and costs that would be incurred with any loan. For example, there is an origination fee, an up-front mortgage insurance fee, an appraisal fee, and standard closing costs. As far as Uncle Sam is concerned, the money received from a reverse mortgage is not taxable as income, regardless of the way the money is paid. Likewise, many states do not consider reverse mortgages as income. They are not count ed as disqualifying resources for most Federal and state public assistance programs.

A reverse mortgage must be carefully evaluated as it is more complex than other secured loans (like home equity loans, for example). It is suggested that seniors considering one seek the advice of a legal, tax or financial advisor. In fact, the law requires that seniors receive counseling before they obtain a loan. Typically, such counseling covers budgeting and general financial planning, as well as the tax implications and Medicaid/public assistance ramifications. The AARP, Fannie Mae and HUD are three agencies that provide counselor referrals. As previously mentioned, reverse mortgage loans contain fees and costs. However, the fees and costs are low and are not paid out of pocket or up front. They are added to the total loan amount along with the interest, and are paid when the loan's term expires. If a borrower's reverse mortgage is structured as monthly payments "for life", his or her estate may end up paying off the loan.

The Federal reverse mortgage program assumes a life expectancy of 100 years, thus, monthly payments may be lower for seniors closer to age 62 than for those nearer to 100. The life expectancy assumed by Massachusetts, as well as for all other programs is 100 years. One thing about reverse mortgages that seems to worry most seniors is that having a reverse mortgage loan will prevent their children and grandchildren from inheriting their home.

Seniors who want to ensure that their heirs are provided for could take advantage of the new transfer rules under the Deficit Reduction Act of 2005 (passed in 2006) which allows, among other things, transfers made five years before their application for Medicaid to be outside the "look-back period". Being outside the "look-back period" means that the seniors will not be penalized for the transfer. For example, if a senior gives some of her savings and investments to her grandchildren five years before she needs Medicaid, she qualify immediately, provided of course, that she is careful not to make it seem like the transfer was made for the sole purpose of qualifying. Even if seniors do not take advantage of the new transfer rules, the rising costs of real estate should protect the home for their heirs, who can sell the house and use the proceeds to pay off the reverse mortgage note and keep the profit. In fact under the Deficit Reduction Act, seniors with more mortgage on their home may fair better (in some circumstances) that those who have higher equity.

The new law's limit of $500,000 on home equity (which can be increased up to $750,000 at state option) may well mean that seniors owning homes with greater equity could risk not qualifying for Medicaid coverage. If the equity is tapped using a reverse mortgage loan,  seniors may be sheltered from disqualification.

Because You Were Curious: Other Home Equity Conversion Mechanisms The desire of seniors to utilize the value of their homes' equity, while continuing to live in their homes has led to banks offering various other home equity conversion mechanisms in addition to reverse mortgages. Home equity loans, sale-leasebacks and financial arrangements in which seniors retain a life interest in the home while selling the remainder interest are other options for seniors to harness the equity in their homes. However, none of these are as beneficial to seniors or are as easy to obtain as a reverse mortgage.

For example, most home equity loans require that the borrower demonstrate a dependable source of income that can support monthly re-payment obligations. As a result, most seniors in retirement are not likely to have the income that is necessary to obtain a home equity loan. In a sale-leaseback (where the home is sold and then simultaneously leased back to the person for life) or a sale of a remainder interest transaction (where the homeowner retains a life estate in the home while selling the remainder interest) a major concern, in each of these transactions, is that it may be difficult to find a suitable buyer who is willing to buy the home subject to the sort of leasehold restrictions that an older homeowner requires. In sale-leaseback and remainder interest transactions, there are also tax and public assistance issues that may not make these viable options for seniors.

Reverse Mortgage in Summary

A reverse mortgage is a financial planning tool that is increasingly being used by senior homeowners from all walks of life. They are an attractive option that allows seniors across the economic spectrum to have more cash by increasing the liquidity of an asset that most do not think of as liquid, a home. According to Ed Barrett of Your Home For Life, "Reverses offer a better quality of life for those who need more cash flow than offered by a pension or social security benefits and enable much needed repairs to your home to be made, all without making a single monthly payment," and while reverse mortgages can't remove wrinkles, increase energy or improve memory, they do help seniors lead a richer and more rewarding life.

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Gosselin Law's short sale group can be reached at 781-782-6000 or toll free at 877-325-6746. Gosselin Law has convenient office locations in Boston and throughout Massachusetts.

What is a Short Sale:

• When a lender accepts a discount on a mortgage to avoid a foreclosure or bankruptcy.

Why a Lender Would Take a Discount:

• They do not like excess inventory or bad loans on their books;
• Loss mitigators have incentive to clear up defaulted loans - short sales help do that; and
• Lenders know they can lose more money if a home goes to auction.

Lender "Short Sale" Factors:

• Whether the seller deserves a break due to: financial hardship caused by unforeseen circumstances (layoffs, divorce, illness, etc.);
• Whether it would be cheaper to repossess the home, fix and sell;
• How many other properties the lender has in default; and
• If co-signers are on the loan and can help pay the mortgage balance.

The Short Sale Process:

• Acquire a professional (such as a real estate attorney) with short sale experience.
• Contact the lenders 'loss mitigation department' to discuss the possibility of a short sale and determine the lenders process for completing the sale. This sometimes involves acquiring a 'Short Sale' or 'workout' packet.
• Seller must issue a signed 'Release' or 'Authorization to Release Information' to authorize the release of personal information about the loan and the property for the buyer or escrow agency.
• Lender will review the settlement statement indicating: sale price, loan balance, expenses, commissions and fees associated with closing the sale.
• Seller must complete a 'hardship letter' explaining the reason for wanting a short sale. The letter should include all information regarding the financial circumstances of the seller along with bank statements, investment account information, pay stubs and other necessary financial information.
• The lender will connect with the broker to provide a price opinion based on the condition of the home, market value, maintenance costs, etc.
• The lender reviews the purchase agreement and real estate commissions and weighs them against the cost of repossessing the home to sell or auction.
• If the lender finds the situation works in their favor, the short sale will proceed with the terms negotiated in the purchase and sale agreement.

Short Sale Mistakes to Avoid:

• Don't low-ball your offer. Lenders are trying to minimize loss and have a good sense of property values so make your offer as tempting as you can while staying inside your profit guidelines.
• Have a knowledgeable short sales professional on your side. Lenders are busy and do not have time to explain the process so make sure you know what you are doing, or find someone (like a real estate attorney or a broker with short sale experience) who does.
• Don't assume each lenders short sale process is the same. Each lender has different documents, requirements and regulations so don't foul up by making assumptions.
• The fewer loans on the property - the smoother the short sale process. Avoid complicating an already complex process by having a good handle on what's owed on the home.

Why Short Sale Knowledge is Important for Brokers and Real Estate Agents

• You can recognize  the opportunity to sell a home and receive commission on a home that would otherwise be repossessed by the lender or auctioned.
• To develop a favorable reputation among potential buyers (who stand to purchase a discounted home with a short sale) and among sellers (who will no longer go into foreclosure or declare bankruptcy) let the experienced short sale lawyers at Gosselin Law guide you through the MA short sale procedure. Very often the legal fees are negotiated with your lender as part of the short sale procedure. Gosselin Law's short sale group can be reached at 781-782-6000 or toll free at 877-325-6746. Gosselin Law has convenient office locations in Boston and throughout Massachusetts.
Tags: Boston law firm, Century 21, Gosselin Law, Massachusetts Real Estate Attorney, Real Estate, Real Estate Broker, Short Sale, bankruptcy, boston, boston lawyer, boston short sale, boston short sale lawyer, foreclosure, foreclosure relief, gosselin and associates, lawyer, lender, loss mitigation, ma short sale, massachusetts lawyer, massachusetts short sale lawyer, mortgage, refinance, short sale lawyer, short sale procedure, short sales and massachusetts
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The problems are starting to happen:

• A loan officer who gets caught pretending to be a borrower at closing.
• A borrower dead for 15 years - still on the title, so his 48 year-old son with the same name takes a reverse mortgage, and almost gets away with the money.
• An elderly woman on Medicaid benefits is talked into taking a lump sum  reverse mortgage and her otherwise protected money is taken for reimbursement by Medicaid, leaving her penniless.

Mortgage scams have been around as long as there have been mortgages (as you've learned in past blogs, reverse mortgages have been popular since the Roman Empire - literally "loans until death").

Reverse mortgages are available in Ireland, India, United Kingdom, Australia, the U.S. and other countries in various forms. "Life loan" (Irish/UK term for a reverse mortgage) programs are very similar to U.S. reverse mortgages. Here's a link to a program brochure for Bank of Ireland's life loan program: Bank of Ireland.

There are significant differences in these programs compared to a typical U.S. FHA reverse mortgage. First, the borrowing limits are tied to age and are quite low, generally around 25% of property value. Second, the interest rate is fixed for 15 years and there is a pre-payment penalty for early payment unless it is due to death, moving out of the property for more than 6 months or the sale of the property. Lastly, the program will not lend against property that appraises lower than €200,000 (about $275,000) although reverse mortgage loan limits are quite high at €400,000 (about $550,000).

One big difference between U.S. reverse mortgages and the Irish program (similar to the UK and Australian programs) is the borrower is required to have independent legal advice as part of the transaction. This would be a very positive step for the U.S. reverse mortgage industry, because so many elders do not understand the full consequence of their borrowing and the U.S. counseling certificate program is limited in its scope.

Many experienced elder law attorneys who could affordably advise elders that having each potential borrower retain an elder law lawyer would not be a large economic burden but could reduce the risk of improper loans substantially.

Not only does the Irish reverse mortgage program require legal counsel prior to and at closing, but it contains a unique requirement that would help reverse mortgage servicers recoup loan proceeds more efficiently. The Bank of Ireland reverse mortgage program requires the borrower to have a will and to notify the bank of its contents (as to executor) prior to closing.

The long list of new reverse mortgage products coming to the market reek of the influence of sub-prime lending and of Wall Street's thirst for profits.

These new reverse mortgage programs, for the most part, are not written to make reverse mortgages more affordable or understandable, but rather to make them more profitable to both mortgage lenders and Wall Street.

In the past weeks, Congress picked up the cause of elders with reverse mortgage specific components of the FHA Modernization Bill working its way to President Bush's desk. More important for the reverse mortgage industry, this bill increases FHA lending cap limits, reduces the maximum origination fee and makes the HECM (Home Equity Conversion Mortgage) product more flexible (i.e., allowing a HECM for the purchase of real estate, which can be compelling from an estate planning perspective under the right circumstances).

Watch Congress, HUD and responsible mortgage wholesalers such as Mark Burton at Beacon Reverse and respectable mortgage brokers like Ed Barrett at Your Home For Life and Brett Kirkpatrick at Mortgage Financial Services to continue to be watchdogs for the reverse mortgage industry. They will help guard against it blowing up into a sub-prime-type fiasco, only hurting elders by limiting access to their home equity just when they need it most.

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Have you heard of the new reverse mortgage product? Borrowers can be any age, borrow up to 100% of their equity and can get a fixed rate with no closing costs on a reverse mortgage (and it pays 4 points to the mortgage company!) - Just kidding!

New reverse mortgage products are popping up daily from lenders of all stripes. It's almost like reverse mortgages are the new sexy product category of the mortgage industry - like sub-prime loans were in the past decade. We know where that got us.

But is the market large enough to absorb all these new products? Despite being cool variations of the reverse mortgage theme - such as going to 60 year old (and younger!) borrowers, fixing rates, tying rates to any manner of indexes and making closing costs appear to be lower, the new reverse mortgage products appear to be driven more by a need for marketing than actual innovation. So, elders who are confused enough already about the prospect of taking out a reverse mortgage on their homes, now have to wrestle with the dozens of variations that the reverse mortgage originator can put on the table.

I am all for innovation in the reverse mortgage industry, but I really don't believe that the wholesale mortgage industry is on the right track with creating a myriad of new products. It seems that they are only sending out new product slicks to get the attention of reverse mortgage brokers. This will only invite reverse mortgage abuses. We have seen this pattern so many times before. Wholesalers just make new packaging for good core products - perverting the good with the ugly.

This is not going to work with reverse mortgages. If wholesalers want to increase market share they should do it through marketing support and education. They should make their brokers experts in selling reverse mortgages - not motivated strictly by mortgage sales commissions - but by providing great service to their clients and their communities.

Not every mortgage company should sell reverse mortgages. Reverse mortgages are a specialty product. Reverse mortgages require educated consultative sales people. Yes, they need to be well equipped, but the trend towards more and more aggressive underwriting and riskier variations on reverse mortgages will only backfire on the uninitiated. Our law firm is focused on the education and co-marketing of reverse mortgages to the elder community. We are not interested in selling reverse mortgages, only presenting them and helping elders decide if it is a good fit.

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Reverse mortgages are not just for poor people anymore. I am tired of hearing about reverse mortgages - in the past six months it's as if someone flipped a switch to turn up the noise, not necessarily the quality, of the messaging to elders about reverse mortgages.  

In my practice as an estate planner in Massachusetts I am often called upon to "get creative" on behalf of clients. As one of only a few true legal experts in the reverse mortgage industry, my creativity often opens the discussion with clients about complex uses of reverse mortgages in estate planning.

 I have developed several methods to leverage the equity value of a client's house to enhance either the economic benefit or overall personal security of clients. To explain the concepts in shorthand, Gosselin Law claims a servicemark on the shorthand names of many of our approaches. Here are examples of somewhat magical things that can be done with reverse mortgages as an estate planning tool.

GOLDEN TRIANGLE(sm). The Golden Triangle demonstrates to elders looking to plan for long term care how to use the reverse mortgage as a tool for closing the five year gap provided under the new Medicaid laws. It is a triangle as there is an estate plan, a long term care plan and a reverse mortgage plan coming together to provide for both current and future long term care needs. Here's how it works:

Mary, a 77 year old widow in Boston, has lived in her own home for over 40 years. This is the house that sheltered her family, where her dear husband passed and where she intends to stay until the very end. Although Mary has a good pension from the Commonwealth of Massachusetts, Social Security and adequate short term savings,  Mary is concerned that if she needed long term medical care that she could not afford to remain in her home or pay for a nursing home. Mary also wants to provide as much for her family upon her death as possible; after all she and her husband both worked hard to be able to leave something for their three children.

Mary's good health and family history of longevity helps indicate that Mary will likely grow to be very old. Her home is valued at $450,000 in today's real estate market. Based on her age, current interest rates and the property's values, Mary's HECM line of credit will be about $280,000 at closing. Mary qualifies for long term care insurance, but she feels that the $5,000 annual premium, although vitally important to her ability to remain in her home, is too much to pay on her fixed income. As many elder law lawyer advised her to  transfer the house to avoid exposure to a Medicaid lien - but every technique available requires a 5 year waiting period before she would be elegible for Medicaid.  At 77, Mary could live 15, 20 years or even longer - so even with her fixed income and ongoing inflation, she will no longer be able to afford to stay in her home in the not so distant future.

By securing a HECM reverse mortgage line of credit or similar reverse mortgage product, Mary will enable herself to have access to both a current and ready pool of cash, but also an appreciating line of credit that will be available to her for the rest of her life. Using a $5,000 per year draw, Mary will be able to buy the "Cadillac" of long term care insurance (including extensive home care benefits and high benefit limits) which will also serve to exempt her house from Medicaid liens immediately, without waiting for five years. At the same time, Mary's estate planning will have time to season. After five years, Mary will have had the peace of mind in the form of long term care insurance, lifetime financial security, and in her ever increasing available HECM cash and a now permanent estate plan to carry out her wishes. A Golden Triangle, indeed.

An interesting variation on the reverse mortgage that could work well in the Golden Triangle is the "Retirement Mortgage" from Virgin Money. Essentially a child acts as the reverse mortgage lender, documents the transaction as a loan to ensure that he or she is repaid before any other siblings at the time of the elder's death. I am a big proponent of Virgin Money (full disclosure is that I am working with Virgin Money in developing new and exciting products for the US market), on the principle that families should be helping each other first before turning to often high cost products from the financial services community. 

SNOWBIRD(sm). In the Snowbird(sm) we show reverse mortgage companies how to prospect with sunbelt real estate agents to facilitate the purchase of properties with reverse mortgages, primary residences can be obtained with a reverse mortgage purchase money mortgage, and secondary residence by using a reverse mortgage leveraged primary residence in Massachusetts as collateral for the real estate purchase. Similarly, we show elder homeowners how to conserve cash by using reverse mortgages as purchase money mortgages. Here's an example:

Bob and Cathy, 70 and 68 respectively, haved lived in their lovely 4 bedroom home in Newton for over 30 years. Now retired, Bob and Cathy enjoy playing golf, sailing and visiting with their two children and their families (who both live in the Greater Boston area). As much as they enjoy the New England seasons, they enjoy spending the Winter and long weekends in Florida. They have made many new friends and enjoy the Florida lifestyle, especially in the Clearwater Beach area.

Financially, Bob and Cathy have not fared too well. Bob worked for Polaroid for over 30 years, but because of its collapse, his pension benefits and stock savings (all in Polaroid stock) are meager at best. Bob continues to work part time at The Country Club in Brookline, which also gets him some free time on the greens. Cathy never worked outside the home, but has been doing quite well organizing Ebay sales for her friends and neighbors looking to downsize their homes. The thought of doing this at this point in her life brings Cathy to tears, but she and Bob agree that they would enjoy having a place in Florida during their healthy retirement years.

Based on Bob and Cathy's ages, current interest rates and the $800,000 value of their Newton home, they could borrow approximately $425,000 in reverse mortgage cash. They could draw it all at the closing or take some in a lump sum and leave rest to be available for future withdrawals. Bob and Cathy would very much like to purchase a $200,000 condominium in Clearwater Beach condominiums, not far from their favorite public golf course.

By taking out a reverse mortgage as above, Bob and Cathy will have the best of all worlds. They will have the cash they need to buy the Florida condominium outright (and enjoy its appreciation throughout their retirement), a financial cushion in the form of the remaining credit line on their Newton home, and most importantly, will be able to keep and enjoy their home. Of course, interest will acrrue on their borrowings, but between the expected appreciation of the Florida property and the value they place on the two-home lifestyle, Bob and Cathy will have it all in retirement thanks to the Snowbird.

ROBINHOOD(sm). The Robinhood(sm) guides more sophisticated and larger property value elders on the use of asset leverage by using other financial products, especially second to die life insurance. In simple terms, the reverse mortgage is used to pay premiums and the actuarial analysis results in a positive arbitrage for the reverse mortgage borrower. Here's a simple example to ilustrate the idea:

Mike and Sheila enjoy financial security by anyone's measure. Mike, recently turned 65, and Sheila, 66, just sold their successful software company to a larger competitor - realizing over $10 million in restricted stock in the buyer from the sale. Adding that to their $2 million primary residence in Brookline, $3 million Nantucket home and $5 million in other savings, mainly in qualified retirement plans, Mike and Sheila will pass a large estate on to their five children. Or, will they only fill the coffers of the US Treasury? Based on a $20 million estate, Mike and Sheila's estate planning attorney showed them a potential estate tax of over $6 million if they were to die this year.

If we were their attorneys, we would suggest setting up an irrevocable life insurance trust (ILIT) to hold a survivorship (second to die) life insurance policy. As wealthy as they may seem, Mike and Sheila lack sufficient liquidity to commit to a relatively large insurance premium, although the arbitrage on the numbers clearly show the economic benefit of establishing such an estate plan while they are young and healthy. The solution? A reverse mortgage, either on a line of credit basis where premiums are paid annually or a lump sum cash account where Mike and Sheila can purchase their life insurance (through the ILIT) with a single premium.

By using the reverse mortgage to pay the life insurance premium, Mike and Sheila will get the liquidity they need without running afoul of income tax rules or using restricted or otherwise inaccessible assets to pay for the needed life insurance. Upon the second of Mike and Sheila's death, the overall estate will be liquidated and the reverse mortgage paid in full with part of the cash proceeds of the life insurance policy, the balance to be used for paying estate taxes or direct bequests to their family. Based on a sophisticated side-by-side analysis of their reverse mortgage projections and life insurance guarantees, Mike and Sheila can make an educated arbitrage decision without significant risk of economic loss.

We are not licensed to provide insurance or loan products and any decision to proceed with any of these advanced reverse mortgage plans requires you to work with your trusted advisors. But, Gosselin Law can help our clients evaluate various complex uses of insurance and mortgage tools, as well as suggest reliable sales organizations

Gosselin Law is one of the only elder law firms in the country with a reverse mortgage specialty practice. We can assist homeowners in the states where we are licensed or associated with local counsel with the planning of reverse mortgages, coordination of federal benefits with reverse mortgage loan proceeds and gerneral asset protection and estate planning.

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Reverse mortgages are bad mortgage products. Reverse mortgages cost too much in closing costs. Reverse mortgages drain the equity from elders' estates. Reverse mortgage originators prey on the weakest among us. Or so pundits that sell houses, annuities and all manner of ignorant self interested "protectors" of the elderly repeat as if a mantra to ward off the evil of reverse mortgages. Of course, the truth could not be further from their fears.

The US Government needs the baby boomers to embrace reverse mortgages. After all, the national debt has more numbers than my Comcast account, Halliburton needs to keep profitable in Iraq and Americans are living (and getting Social Security and Medicaid benefits) longer than ever. The actuaries tell us that it's not the interest on the national debt, foreign aid or war that will bankrupt the US Government, but rather Medicaid has the power to overwhelm the entire GDP. Where is the money that will pay for all of Uncle Sam' hospital bills?

Medicaid is an issue for the reverse mortgage industry, especially for the reverse mortgage originators that don't know their products and underwriting well enough to advise their customers on the traps. I have been featured recently in the Mortgage Press and the National Reverse Mortgage Lenders Association national teleconference and newsletters as an expert in the intersection of Medicaid regulations and the origination of reverse mortgages.

Here is one of the articles, excerpts from an interview with Atare Agbamu (who writes extensively on reverse mortgage issues):

Traps for the Wary: Reverse Mortgages and Healthcare Benefits -- a conversation with Elder Law Attorney John Gosselin

By Atare E. Agbamu, CRMS

They say old age hardly comes alone. It comes with issues. The same can be said of reverse mortgages, the new pillars of retirement security in these precarious times.

Reverse mortgages come with issues, government healthcare benefits issues. The relationship with government healthcare benefits is deeper and more challenging than most originators and customers suspect.

To help us understand the connection and its implications for originators and customers, I spoke with Winchester, Massachusetts-based elder law attorney John T. Gosselin.

The Managing Attorney of his own law firm, Gosselin & Associates, P C, with offices in Massachusetts and New Hampshire, Mr. Gosselin is one of a few lawyers, in my experience, who really understand reverse mortgages, particularly how they mix with other elder law issues.

Besides overseeing a vibrant probate administration and elder law work, Mr. Gosselin runs a thriving real estate practice, acting as counsel or closing agent in more than 20,000 transactions, advising clients on purchase and sale agreements, mortgages, financial, and title disputes.

A member of the National Reverse Mortgage Lenders Association (NRMLA), Mr. Gosselin has advised and represented lenders in reverse mortgage situations for more than 10 years.

As you will find from our conversation, Mr. Gosselin has thought these issues through. His knowledge, insights, and suggestions will help you serve your customers better. They could help your company avoid some difficult issues too. [Disclaimer: Nothing in this article should be considered legal advice. Seek competent counsel for your unique situation.] The following is a transcript of our conversation.

Atare E. Agbamu: John, what is the loss of Medicaid Eligibility risk for the typical reverse mortgage borrower?

John T. Gosselin: The big risk is being over asset. The way you qualify for Medicaid benefits is to be poor. Medicaid is welfare. So in order to qualify for welfare, you need to be poor. And the government defines poor as a combination of assets and resources. And they define it all as available resources. That's the term that is used. If you have more available resources than the limits that are allowed by law, you cannot qualify for benefits.

The first risk is a borrower holds too much cash in their name, by virtue of holding too much cash, either through a lump-sum distribution from a reverse mortgage or drawing too much down from a HECM [government-insured reverse mortgage] or drawing a small amount from a HECM but not spending it. A lot of our borrowers in the reverse world are used to living on very low amounts of money. So when they start drawing from a HECM, they feel uncomfortable spending it. I have seen that happen where the borrower accumulates relatively modest payments over a short period of time to put them over the asset limits.

The asset limit, commonly, for an individual person, is about $2,000 in liquid resources, in addition to their principal residence. They are allowed to have a principal residence, but they can't have more than $2,000 in total liquid assets at the end of any month. So at the end of any month, they can't have more than $2,000 standing in their name and receive Medicaid benefits.

So the risk is that they are going to draw down or borrow more than what is allowed. By doing that, if they are over age 65, as almost all our reverse borrowers would be, it will automatically put them in situations where they are either going to be disqualified for benefits and/or subject to reimbursement for benefits they have already received. That is the risk specific to Medicaid.

There is another risk which is also related, Supplemental Security Income (SSI), which is an additional welfare program. It is intended mainly for people who are very poor, who have neither Social Security nor virtually any social security income. This is another scheme which the federal government provides for its poorest people. Generally, these are people who never paid into the system by working at jobs which provide for federal social security and insurance benefits. It is not an insurance program; it is a federal welfare benefit. And that program has very strict income guidelines.

Although a HECM advance doesn't disqualify them as income, there is a risk of going over the asset limits. There is income that is assumed to come from those assets. There is a formula that is done. If they are holding too much in assets, they can be disqualified from SSI. Again, holding too much cash is a problem. Having money in a given month is not a problem. They could draw down tens of thousands of dollars if they spend it for their own personal needs, their care, and their protection. They can really spend it for anything. They are spending an asset that is protected, which is their house. At the end of 30 days, they better get that asset back under $2,000. At the end of each month, their cash has got to be under $2,000. And they could not have accumulated other easily liquidated assets, like buying jewelry, for example. They can't buy more than one motor vehicle for their own use. They can't accumulate collectible assets. They can't go out and buy antique furniture that is going to carry a cash value or easily liquidated value. So they are somewhat restricted in how they use their funds, but not terribly.

One other dimension that people should be aware of (I don't expect this to occur often) is that the tenure payment could be construed as income. We usually say that reverse mortgage payouts are never income, that it is always drawing against the value of the house, but the reality is that when the balance of the mortgage exceeds the value of the collateral, it can be recognized as income; because, effectively, it is no longer a loan because the proceeds are exceeding the value of the collateral. The IRS would recognize that as a form of taxable annuity income. That could run into some problems.

Now why I say it shouldn't come up much is that the tenure payment is fairly conservative. The formula used to come up with the numbers really anticipate someone living quite some time before the loan gets upside down; but, in a declining real estate market, you could, potentially, see that become an issue in the future.

AA: From your experience, how valuable is Medicaid Eligibility to the average senior person? For it to be a serious loss, it has got to be pretty valuable.

JG: For the average senior, they are probably going to be receiving Medicare benefits because that is an insurance program that people pay in when they work, and they work for wages. The vast majority of people over 65 are on Medicare benefits.

The Medicaid benefits we are talking about will affect reverse mortgages. It could be supporting a spouse that is in a nursing home. For example, if we have a wife that is in the community and a husband in a nursing home, the wife in the community (it varies by state) on average, is allowed to keep the principal residence and approximately $100,000 in assets. It does vary. More or less, it is $100,000. If she goes over the asset limit, she can disqualify her spouse for the benefits that they are receiving for the husband's care and possibly be forced to reimburse benefits already received.

Most often, I think, when a spouse of someone who is borrowing on a reverse is in a facility [nursing home], they are disqualifying the spouse often unknowingly. This is one of the traps for originators. They should inquire whether or not a spouse is in a nursing facility and determine how that spouse is paying for their care. Sometimes the spouse will no longer be on title so the topic does not come up unless a direct inquiry is made.

There are other ways to pay for nursing care. One of them could be VA [Veteran Administration]. The VA is very low cost, and it doesn't really impact reverses as it is tied to service record and not only financial need. There are also religious and community organizations that provide unique living situations for elders, many of these require turning over large lump sums in favor of lifetime care contracts. Home care services are also coming along that will essentially enable seniors to have nursing care at home on a somewhat more affordable basis. Another place Medicaid comes in is community Medicaid.

Community Medicaid is a program that supplements Medicare. Again, it is generally for the poorest people, both seniors and those under 65. The people whose income and ability to pay for what Medicare doesn't pay for is compromised, so they would go for Medicaid benefits in the community, or they need some special services or in-home care through a variety of community programs.

There are in-home care programs that are coming up every day now in every state, where instead of going to a nursing home, the state will subsidize a certain amount of in-home care. It is that in-home care we need to be concerned with because if it is under the Medicaid program, it is subject to reimbursement. Think of Medicaid like a loan from the government.

AA: So this is a very valuable program for the average senior because it protects their health, right?

JG: The Medicaid program we are talking about is a community health insurance benefit. This pays for every aspect of medical care. It pays for prescriptions. It pays for hospitalization. It pays for virtually any medical need of an elderly person. You could have reimbursement obligations in the millions of dollars for somebody who has a serious illness.

You could have someone who has MS [multiple sclerosis], Lou Gehrig's disease, or a form of cancer that has received hundreds of thousands or even millions of dollars worth of care through the Medicaid system. Yes, it is absolutely a valuable benefit.

To lose the benefit for people who are receiving the benefit would probably be catastrophic. They could put themselves in situations where their medical debt could consume the value of their house. If they have no other means of paying for their medical debt, they could be forced into bankruptcy for their medical debt.

The US government needs to find a way to use the wealth stored in home equity for people's care, I think we'll see a much simpler reverse mortgage product coming very soon, like a low interest rate reverse mortgage that's sold directly or at least wholly subsidized by the US Government to get at people's home equity for elders' medical and home care needs.

 

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Law for Life is officially the new street name of Gosselin & Associates, P.C. and Gosselin Law, our brand, if you like. Our completely renovated website at www.lawforlife.com has been carefully planned to be the easest and most thorough site on elder law matters in cyberspace. Please let me know how you enjoy the new site!

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A few months back my barber became seriously ill. Since I get my haircut about once every 6 weeks or so, I happened to come to the barber shop at the beginning of the "bad news cycle" that the other barbers in the shop had started. These old Italian men quite emotionally described how their brother barber had fallen ill, the grave prognosis, his family's sorrows, the distress on his friends, etc. It was quite a natural outpouring of woe about everyone's mutual friend.

Because of a probate court date I needed a trim about a month later, I was met once again with the news of the barber's illness, he'll be out until March, his wife has taken time from work, etc... It was quite matter of fact really, but they needed to tell me as I had asked "how's he doing?" This got me thinking about how there is a whole exercise around communicating about grief. How we become accustomed to repeating dreadful things. "Yes, he went quickly, the bus driver was cited for speeding." "Mother fought cancer for years, it's a blessing she's gone." "I just woke up and there he was, he never woke up."

Anyone that has stood in the receiving line at a wake has taken part in the modern grief dance. The mourner says "I'm so sorry for your loss"; the family member says "thank you for coming, it would have meant a lot to old Ed." Rinse, wash, repeat. I'm not a psychologist, but I think there's some harm in wakes. Originally wakes were apparently held to ward off evil spirits (by staying awake with the body) until you got the body in the ground. Wakes then evolved to be a form of confirmation of death and social event. Until fairly recently in human history wakes were always held in the family's home. Either dead people started having more friends or someone saw a business opportunity in using their living room for wakes and the "funeral parlor" was born.

Me, I'd be perfectly happy to be waked in my front hall. The wake is an event for the living, not the dead. It's a time to bring families together to mourn, grieve and share stories of the dear departed. But wouldn't it be nice for a widow not to have to explain how her husband got stuck in the snowblower last Thursday 400 times? I propose a new model for wakes. First, let's do them in happy places, like Cheesecake Factory or the Museum of Fine Arts (another business opportunity for AARP?). Seriously, the body will be happy whereever it's placed and frankly it's only our more recent generations where all things humans are pasteurized and sterilized. In many countries bodies are buried quickly after death (mainly for the practical purpose of avoiding the consequences of hot weather), but also to dispatch the corpse so that there can be a celebration of the person's life through various forms of mourning. Heck, maybe the Probate Court could be a positive place for families to come together? I've always wanted to officiate a reading of the will like you see in movies, maybe it could be a new tradition to have a will read at a social event for the recently departed? As outlandish as these ideas may seem, our customs change over time - influenced by the tastes and preferences of people. Americans like convenience and America, Inc. likes to sell at every turn - watch out for commercialism of this most sacred time, too.

I think having a positive venue for a wake and funeral sends the message that the family continues to live. I think obituaries could be a bit more truthful as well to avoid the inevitable "how did she die?" question. How hard would it be to add a short line that says "Mary was walking along Main Street last Tuesday when a tiger that had recently escaped from the zoo caused her untimely death." I will say I like what the Boston Globe has done with their obituary section recently. The Boston Globe has added the option (for a price) of adding a photograph of the decedent. I am always drawn to these people's pictures. Today, sadly, there was a two month old baby's picture. The other day there was a Marine in his dress blues that is not coming home from far off lands. It's good to see that the dead are like us, not only old, but all ages. Death is a great equalizer - it doesn't know class, race or creed. It is one of life's certainties, and I believe the more we embrace proper estate planning, communication between family members about last wishes and the inevitability of death, the less stressful our deaths will be for the loved ones that we leave behind. Those who know me know that I love to boat and fish in Boston Harbor. A funeral director friend of mine has a boat berthed near mine, her name is "No Wake Today."

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The son of philanthropist Brooke Astor was accused in an indictment unsealed Tuesday of plundering his mother's $198 million estate and conspiring to have the Alzheimer's-stricken socialite sign a new will leaving her fortune to him.

I guess this shows us that the rich are just like everyone else. Greed is no more a condition of poverty than hunger is a condition of obesity. Humans with a nature to cause harm to their families for their own profit come in all shapes and sizes. Brooke Astor is no more immune to her family's greed than any other elderly woman suffering from the ravages of dementia. Probate, estate taxes and trust issues for the rich are the same as for everyone else - just magnified by the scale of wealth.

A big part of our estate planning process is developing strategies to prevent abuse of the elderly. Using co-fiduciaries, professional trust services and checks and balances built into our documents, we are able to give our clients strong lines of defense. Brooke Astor may have had access to the best lawyers in the United States because of her wealth, but without an understanding of elder law and the dangers of elder abuse, even the best lawyer in Boston cannot imagine the opportunity for fraud within a parent-child relationship. Our experience tells us that the "big firm" lawyers are ill equipped to deal with what is often more social work than legal work.

Our practice is to approach mental health issues in our elderly clients as a multi-disciplinary issue. Working closely with medical providers, financial planners and social workers we craft bespoke plans that respect each individual client's unique personal situation. House, hospital or nursing home calls are commonplace in what we do, how else could we know how our clients live? Ask your downtown Boston lawyer to visit the nursing home on a Saturday morning.

In her day Brooke Astor, was a great philanthropist. In a great twist she will continue to be philanthropic through her own son's misdeeds by giving America an example of greed to the umpteenth degree. For elder law lawyers, Santa Claus could not have brought a more perfect Christmas present for elder parents than the example of the consequences of poor planning. Do your grandparents, parents and self a favor and give the affordable Christmas gift of good estate planning. And, yes, I would be happy to sell you a gift certificate for estate planning!

 

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The housing market and mortgage industry, like the economy, rise and fall. This is normal and consistent with U.S. economics principles. No offense to major media outlets, but these are normal times. As I write this article, interest rates continue to hold steady at historic lows and housing inventories are at their highest levels in years. This is good news for buyers, not such good news for sellers.

Homeowners purchasing property in recent years may have bought properties priced higher than their current value, and financed those properties at high interest rates or via adjustable rate mortgages. This might explain why there's been a sharp rise in potential short sales listed in Massachusetts this year. Between January and August this year, 287 homes were listed by their owners through MLS (a real-estate listing service) as potential short sales, up from 51 last year. And many experts expect this number to increase in the coming months.

The Long and Short of Short Sales & Foreclosure

Short sales, like foreclosures, fall into the real estate category of arrangements called 'distressed sales,' but short sales differ from foreclosures and other kinds of distressed sales in many respects. For one thing, homeowners do not have to be behind in mortgage payments to venture into the short sales market. They merely have to demonstrate their homes can't be sold for what is owed on them. A short sale is an "arrangement" between the current owner of a home and the lender, where the lender accepts an offer less than the total amount owed on the mortgage. The "deficiency" is the difference between the amount owed, and what is collected at a short sale closing. It is important to note if a bank sells a house (most likely at auction) it is not a short sale. A seller deciding to lower the price and take less profit is not a short sale. Someone who owns a home free and clear, who sells a $150,000 for $75,000 - is not a short sale. For it to be a short sale, there must be an outstanding mortgage on the home and either the seller or the lender must be getting "shorted."

Foreclosure occurs when a lender files a notice of intent to foreclose in the Massachusetts Land Court because of non-payment. This filing notifies the homeowner that unless payments are brought up to date, the home will be sold to the highest bidder. Not all homes that fall into foreclosure go to public sale. Owners have the right to cure, i.e., make up "back payments" up to a point. Pending legislation in Massachusetts, House No. 4085, proposed by the Governor in July of this year, gives homeowners up to 90 days to cure. The 90-day clock starts ticking from the date that the lender mails the notice.

Why Have a Short Sale Instead of Foreclosure?

Even though it is not necessary for homeowners to be in arrears on the mortgages to qualify for a short sale, a homeowner can't just wake up one morning and decide to sell the home in a short sale transaction. Short sales require the approval of the lender, and typically, lenders won't consider a short sale if payments are current. Lenders aren't in the business of buying or selling property and are certainly not interested in losing interest money from interest rates on financed homes. In approving short sales arrangements, lenders usually do diligence on the homeowner/seller, the buyer, and the party financing the buyer. While the kinds of evidence lenders require varies, in doing diligence, all lenders usually require sellers to submit a hardship letter which specifically details the seller's financial difficulties. The lender may also require pay stubs, copies of medical bills, credit reports, checking account statements and other proof of financial hardship. From the buyer or buyer's representative (attorney, broker or the like) the lender will require some kind of release, signed by the seller, authorizing the lender to talk to the buyer about the seller's mortgage. In general, a buyer's first interaction with the lender is through the lender's loss mitigation department. At or near the closing of the short sale, the mortgage lender will review the settlement statement, a contract between the buyer and the seller, containing a description of the source of the buyer's financing.

In making a decision whether to foreclose on a property or to accept a proposal from a homeowner/seller and buyer to enter into a short sale, lenders may consider the following factors, among others:

• whether the seller is deserving of a break
• whether it would be cheaper to simply repossess and sell
• how many other properties the lender currently has in default
• whether there are co-signers on the mortgage who can be held responsible for the balance owed on the mortgage

Loss mitigators are also part of the decision-making process. They work for lenders and sometimes receive bonuses based on how many defaulted loans they clear up efficiently and inexpensively. Loss mitigators might be more likely, especially during certain real estate markets, to accept a detailed, well-done short sale plan versus foreclosing on a property. Foreclosures in New England typically cost an average of $50,000 and are time consuming to the lender.

In conducting diligence, homeowners can expect lenders to order what's called a broker's price opinion, which will give the lender some idea of what the property is worth in the current market. Sellers can get their own opinion from an independent appraiser.

What Are the Credit or Other Related Consequences of Short Sales Transactions?

Sellers at short sales will take a hit on their credit score, but a short sale typically turns out better compared to foreclosure, especially if that seller wants to qualify for another mortgage. For example, if a seller's FICO score was 680 before a foreclosure, after foreclosure, the seller's score could dip as low as 400 and the seller may have to wait about 36 months before a lender will offer a reasonable interest rate.

On the other hand, if a seller with the same number of points entered into a short sale transaction, the FICO score will only fall about 80 to 100 points, i.e. to about 580 to 600, and in about 18 months, the seller can buy another home with financing at a good interest rate. As part of the negotiation, sellers (or representatives) might ask the lender not to make an adverse report to credit reporting agencies. Lenders are under no obligation to accommodate this request. In fact, some companies require them to report as part of their policy.

Lenders are likewise under no obligation to "write off" the loan. Sellers may still be legally obligated to pay the difference between the loan amount and the amount that the buyer paid for the property if at least one of the following is true:

(1) the terms of the loan agreement make the homeowner personally liable; and/or

(2) state law requires lenders collect loan deficiencies from homeowners/sellers.

In Massachusetts the current law in this area permits with little restriction, the loan agreement to govern. Thus, it is important sellers review loan documents with an attorney to make an informed decision. Attorneys can advise sellers on legal options or obligations and whether they will be subject to the possibility of a deficiency judgment for the "loss" to the lender who permits them to "sell short."

What About Income Tax?

Sellers might think that they are fine when it comes to taxes from selling a home less than its value. The IRS sees it differently. The deficiency the sellers paid in a short sale transaction is taxed as ordinary income. Short sale sellers can expect to receive a 1099 for debt cancellation from the IRS. In the case where a seller is found to be liable for and has paid a deficiency judgment, that amount can be counted as a loss for tax purposes. For sellers with capital gains, short sale losses can be subtracted from capital gains. For those without capital gains, the law presently allows them to deduct up to $3,000 for the year. Additional losses have to be carried forward to later years at the rate of $3,000 per year. Each seller should be certain to get individual tax advice for specific transactions from an attorney, CPA or other similar professional as part of the process of considering a short sale.

Pending Federal Law and New Massachusetts Regulations

Representatives advising sellers should, in addition to advising on existing tax law, be aware of pending federal law that could potentially affect taxation on short sales (if enacted) as well as new Massachusetts regulations currently in effect. On October 4 of this year, the House passed the Mortgage Forgiveness Debt Relief Act of 2007. In sum, should this piece of legislation pass in the Senate, it will amend the Internal Revenue Code to exclude amounts attributable to a discharge of indebtedness incurred on a principal residence. There are limits on the amount that can be discharged, among other provisions of the bill. Attorneys or others representing sellers in a short sale transaction should keep an eye on this bill and, for now, make their clients aware of it as a future possibility.

Currently Massachusetts has promulgated regulations to protect and help sellers in a different way from the pending federal legislation. New regulations apply to what they call "foreclosure rescue transactions" and "foreclosure-related services." The regulations took effect this September and are intended primarily to protect sellers from charlatans in the foreclosure world who prey on sellers in danger of losing their homes. Here's how scam foreclosure rescue schemes typically work. Businesses or professionals claim to assist consumers who are facing foreclosure by convincing them to convey their property to straw purchasers. The straw purchasers then obtain mortgage loans, permitting the individuals facing foreclosure to continue living in their property for a limited time, and promising the individuals they will be able to later reacquire their homes. The promises of maintaining home ownership are illusory and homeowners lose their home to the so-called "rescuer." These new regulations underscore the need for attorneys zealously representing their clients in Massachusetts and thoroughly investigate the buyers in a transaction.

Selling Short in Short

In the world of investment, securities stocks are often sold short; meaning that an investor sells borrowed securities in anticipation that the price will plummet and the stock can be paid back at a lower price. This is called "covering" a sale of shorted stock.

A short sale in the real estate world is fairly similar. A homeowner who does not yet own the home (i.e., the home is mortgaged) can sell it to a third party to "cover" the mortgage. Short sales in the mortgage world therefore, amount to an accommodation by a lender who hopes to avoid or at least mitigate an impending loss by permitting a homeowner/seller to "short" the property - selling it below the value of the mortgage to a buyer who is not the lender.

As previously mentioned, it is not necessary for homeowners to be behind on their mortgage in order to enter into a short sale transaction. If that is the case for a particular homeowner, it might be important for the homeowner to know a short sale or foreclosure are not the only options. Even though this article is limited to discussion of options to short sales and foreclosures, these are not always the best solutions for every homeowner with an "upside down mortgage." Attorneys or other representatives would be well-advised to have homeowners consider workouts or restructuring of loans, voluntarily offering the lender the deed in lieu of foreclosure or inquiring if mortgage insurance will cover the deficiency. Short sales can be risky, somewhat intrusive and involve a long, frustrating process, but could be worthwhile, provided homeowners and their representatives work together to choose and negotiate the right solution for the right client.

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At one time the general rule for evaluating nursing homes was whether or not there was an overpowering stench of urine when you walked in the door.  I have been to many a nursing home in Massachusetts that failed this simple test.  Beyond this simple measure there are a number of measures that potential nursing home residents and their families can use to judge the suitability of a long term care facility.

To me, the best nursing home is the nursing home that is convenient for the patient's family to visit often.  The patients with the most regular visitors get the best service.  Sort of a spin on the squeaky wheel gets the grease.  The grease in a nursing home could be clean sheets, regular bathing, hot food and little extras (like smiles and a second pudding) that make the reality of long term care more bearable.  Consistent with this thought, the patients who have regular visitors feel more attached to the living world outside of the nursing home - because let's face it, the vast majority of people go to nursing homes to die.  I do not believe in sugar coating the hard truth that nursing homes are the last place our elders see before death.

What else is important in selecting a nursing home?  Beyond the obvious ratio of staff to patient, aesthetic elements and food quality - you need to look deeper. Ask about the turnover ratio, or how long has the staff been in their current positions. Does the facility just meet the professional staff requirements or exceed the minimums required by law? Is there a support group for families? Do patients have a "bill of rights"? Talk to some patients and their families. Ask what is good, bad and ugly about the facility and its administration.

Despite the trauma associated with being discharged from the hospital, it is imperative that families take steps to conduct their own evaluation of nursing facilities. It is possible to transfer, although not always practical, from one nursing home in Massachusetts to another. Ask questions. Act like a customer, not only as a resigned assignee to whatever long term health care facility selected by the discharge planner. Massachusetts has numerous nursing homes each with their strengths and weaknesses. Be as selective as time allows, be critical, be firm.

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My law firm handles a large number of mortgage closings, estate plans and probate administrations. Honestly, it is quite monotonous, dull work. We input information into the computer and the computer spits out all the magic documents. Then we do it again, and again, and again. As dull as it may be I make a point of instilling in my staff the mission of the law firm.

Our mission, simply, is Clients First. A necessary evil, sure, but we try hard to put a human side to each mortgage closing we push out the door. Each probate involves the death of a loved one, the tension of families revealing their greed to each other, the grieving that makes it ever so hard to hold that green certificate of death in your hands. We see each probate file as something that needs to be handled with great care and respect. Whenever I first meet with a family after a death, the first words from my lips after extending my sympathy is that we are here just to talk about the process and your feelings in divvying up your loved one's affairs. I'm often surprised just how many clients take me up on my free ear and shoulder.

I have been looking around for other monotonous jobs and tried to look a little deeper at what defines excellent service in the face of boredom. It all comes down to people, people make life interesting. My favorite librarian that keeps those books in perfect order is just waiting for a patron to ask her about a good book about Antarctic exploration. My accountant can discuss boats with me until the cows come home, even manages a smile when he tells me that I owe money (I swear the IRS gives him a commission), probably because he is thinking of buying another boat. The firefighters (whose jobs are 95% boredom and 5% adrenaline) I know enjoy sharing current events, recipes and get-rich-quick ideas. What do these boring jobs have in common? People. Good people caring about helping others, but focused on the people they serve. Otherwise they would be easily replaced by machines.