With Durable POA can I stop parents from getting Reverse Mortgage?

What's your parents end game with regard to the house and your brother? Are they hoping to leave him the house or some proceeds or are they just focused on their joint living expenses until they pass and they cant/wont think beyond that? Who's the executor or trustee of their estate and what will that individual(s) role be regarding the house and your brother in the future? If brother lives rent and expense free in your parents house where is the $5k/mo going? Parents could be putting another sibling in an awkward position with him in the house and still there when they are gone. Does he have any rights to the house, how will he be removed when they are no longer there, etc? They get a reverse and have to borrow high closing costs (maybe $20k+) and draw down at least $5k per month, in just one year they have eaten into a decent amount of equity and once anyone on the deed is no longer in the house, the loan has to be repaid from another $ source or the house sold within 6 months and the loan settled. Is your brother on the deed? If so, then as long as he remains in the house the bank couldnt force him to sell as long as he is paying taxes, insurance and upkeep...which may be a problem. These reverse mortgages are usually capped at 50% of the value of the house, so depending on its worth, if they are borrowing $60k+ per year, it might not take too long to tap out the loan and then its just accruing interest and eating into the balance of the equity remaining until it has to be repaid and at that point between the principal and all the interest there could be a lot less than 50% equity remaining. You also have to be worried your brother will convince your parents to draw down much more than the $5k per month which will deplete the balance that much sooner and then how will his bills be paid? These mortgage companies want to make these loans and they are primarily based on the value of the house and not the owners recurring expenses, but they will want to get a sense of your parents monthly spend and red flags may be raised given the costs associated with your brother...which may work to your benefit if they cannot get the loan. And if they dont get the loan, how can they stay in the house...only if they stop supporting your brother? I cannot speak to what is in the DPOA (have you spoken to the lawyer who drafted it?), but if your parents value your involvement with their care, as DPOA or are depending on you in the future as executor or trustee, perhaps you or others with those roles apply pressure and indicate you are considering relinquishing these positions if they get the reverse and/or continue supporting your brother. My sister and I who are collectively co-POA, executor, trustee and successor guardian for another sibling, had to recently "threaten" abdicating our roles bc our mother allowed one of our siblings to live in her house and there are no signs he will ever leave, which is what she wants when the time comes so the house is sold because she believes he will not take care of it and it will affect the neighborhood. She, however, avoids all difficult conversations with him so he has no idea about her wishes and we have no clue if he thinks he has some inside track or rights to the house. (He makes no financial contributions, but on the plus side, is gainfully employed and she doesnt pay his bills.) With our prodding, she eventually put the house in a trust which clearly outlines her wishes regarding the home, and if he doesnt comply there are financial repercussions regarding his inheritance. While she wasnt being malicious relative to her other children, she has enabling him and setting up a situation whereby his siblings look like the bad guys throwing him out of the house and it wasnt fair to put us in that position so we pushed back and said we would give up our roles or we will keep them but cannot guarantee we honor her wishes and get him to leave the house. Enabling behavior which does more harm than good.

I would have a serious discussion over this reverse mortgage and if DPOA concerning this situation. I know it probably doesn't sound helpful but you might want to go over whether you can actually stop it or not. Otherwise, you might have to go another route.

Regrettably, if your parents are considered competent, your DPOA is not going to help prevent them from making this decision to get a reverse mortgage. Do they own their house? If it is free and clear they are using the homes equity to acquire the loan and when the house sells this loan pays back this loan. So, if they do this there would be nothing to pay for care if and when they need it. With them spending so much on the son monthly will also put them into a medicaid look back delema. Maybe, your parents don't fully understand the reverse mortgage process. However, maybe they are being coerced by the son which is not known to you and could this be considered elder abuse/exploitation? Seeking an elder law attorney for a free consultation may or may not be lucrative. Your parents money they can do as they wish, may be the answer you receive from the elder law attorney. But, there is a slight possibility the elder attorney may do some research to check if they really are competent.
Best wishes.

kft4502: Imho, the larger issue at hand is if they have to apply for Medicaid in the future, they will be disqualified because of the gifting of $5K per month to your brother. They are spending more on him, for whatever reason, then they are on themselves. That is perplexing as well as him trying to "talk them into a reverse mortgage." If they cannot afford his living expenses, they why do they continue to do so? Something seems amiss there. They are supplying him $60,000 a year.

The fact that they're spending more on the son than on themselves is in and of itself disturbing, suggesting  (w/o insulting your parents) that they're for whatever reason spending more on their son than on themselves.   And he's considerably younger, and could still be working.  Is there a reason why he's not?

However, if the support is "since birth", I'm wondering if he has disabilities or medical issues that prevent him from working?  $5K is a significant amount of monthly allowance.   My first thought was in fact your brother's possible medical issues, but it could also be that that's not a factor.

Does he work at all, or is he disabled, or just not willing to participate in the work force?   Whatever the reason, this arrangement apparently has been acceptable to all, and I doubt your parents would consider changing it, nor would your brother want it changed.   They're doing this voluntarily, and presumably for a reason.

As already stated, as to invoking the authority pursuant to a DPOA, look to the specific language addressing which actions are allowable, the designation of dementia by medical pros, and the parameters of your authority.

What concerns me the most though is that at some point your parents may need the funds themselves, and presumably your brother isn't going to or won't be financially able to help them.  Others have addressed the Medicaid limitations.   That could be significant, depending on how long they live.

As to preventing a reverse mortgage from being enacted, the last time I reviewed one it was b/c of a (governmental?) requirement that potential mortgagors must consult someone or have the mortgage dox reviewed by someone.  If this still holds, and you're asked, be as frank as you can about addressing their lack of planning for their own needs.

I do think though that to intervene if your parents are capable of making the decision to mortgage their home, you would be jeopardizing your relationship with them.    But there's also a question as to HOW you could intervene. 

Injunctive relief comes to mind, but are you comfortable with hiring an attorney to enjoin your parents from action they may want to take?   And if they aren't mentally compromised, they could equally enjoin you from involvement as well as rescind and execute a new DPOA.

Please tell us more. From your profile: "Hello, I'm struggling with how to deal with a parent I am in big conflict with."

What's that all about?

Tell us more about your brother.

If they are gifting your brother $5K/month, there will be a big problem for Medicaid eligibility down the road. Or are you going to be their caregiver? What is it that you do for them now?

What are YOUR plans for their future, because it sounds like they don't have any (other than possibly assuming YOU will be the caregiver).

Read your document! When you can act and what you can do are spelled out in each individual DPOA document. While many only kick in when your parents are no longer competent, others are not written that way.

I don't know if (or under what circumstances) you could override their decisions, but each POA document has its own provisions.

With Durable POA you can only intervene if your parents are declared by at least two doctors as being unable to manage their own affairs.

Have your parents tested for mental competency. If they do not pass, then notify your brother that you are taking over as their POA. You can then inform him, that you are cutting off his support in order to have finances to care for your parents. If your parents' tests show no mental decline, they can do as they wish - including the reverse mortgage. POAs only kick in when the person is not mentally competent.

If they are mentally competent then you can only carry out their wishes. You act on their behalf and not for them. If they wish to support your brother and he needs support for which he doesn't qualify on his own income then why would you want to stop your brother being supported. However IF he could claim support through State benefits due to disability if they stopped paying him so his income dropped then you have some sums to do to work out which is best for all of them. As you don't say why they support him only you can find out what alternatives you have, but you cannot stop your parents doing anything they want if they are mentally capable - and you need to check that the DPOA you have gives you the rights to continue and manage their affairs if they become mentally incapable as some are for assistance of those capable mentally only and become invalid if capability is lost. Get some legal advice if doing some homework only makes the situation more confusing.

I depends on the DPOA you have. The DPOA, I have for my mother allows me to act in her behalf, but while she is competent (and she is) she can also make decisions. She could void the current POA and write a new one that makes someone else POA. I write her checks to pay her bills; I again make medical appts for her and accompany her; I deal with her ins company or other business. However if a decision outside normal daily business need to occur, I discuss it with her, give her options and my recommendations - this avoids her making one decision and me making another decision.

If your parents are competent and they decide to take out a reverse loan to support themselves and your brother, I don't know if there is much you can do about it beside trying to talking them out of it.

One thing you might do is find out about reverse mortgages and how much they'd get for their house and figure out how long the money would last for the three of them and tell them once the money is gone what decisions they'd face.

Best of luck.

Why did your parents feel they needed to support your brother. And 5k a month? Thats 60k a year. Now they are 85 with only their home. If they pass still owning the home, even if its sold and you share the proceeds, it won't last him long. So now he is on his own in his 50s/60s? Did he ever work. If not no SS or Medicare.
I hope he doesn't think you are the milk wagon.

You absolutely can try to stop a reverse mortgage by telling your parents directly that if they go ahead with it that you will resign as their DPOA and be unable to help them with any of the consequences of their decision. That is the line you draw in the sand and if they cross it then you walk away.

At one point we went through a similar struggle with my in-laws when my mother-in-law was still alive. My husband had DPOA for both medical and financial for both his parents. And one time when my MIL didn't like my husband's advice, she snipped at him "Well I can cancel your DPOA" to which my husband said "Go right ahead!" The look on his parents' faces was priceless. They treated him better after that.

Your parents have an unhealthy relationship with your brother. They are co-dependent. Time to put your big girl pants on and tell them how things need to be or else you cannot help them because you will not enable their bad decisions.

Your brother has received support from parents for his entire life. Hence, for whatever reason, this is what your parents have elected to do whilst in full control of their mental faculties.
Having DPOA gives you no authority until your parents are deemed mentally incompetent and until then any determination is entirely at their discretion. And from there you need to consider objectively what your parents would wish to do under the circumstances (and not how unjust his favoritism has been) since your role is to act as they would themselves - even if reckless, even if to your own detriment.
Sadly, avoiding conflict of interest is your moral obligation although priority must be toward providing your parents with safe and supportive care for the duration.

Are they competent to make there own decisions, if so, then no you cannot tell them what to do. You can suggest. Now if they have both been diagnosed with a Dementia, then they are not capable of signing a contract.

Sorry to say, that they supporting your brother may effect them being able to get Medicaid help in future. Its considered gifting.
Brother needs to be told the gravy train is no longer. That he has taken all he can. The house is all your parents have if they need future care and reversed mortgages are not always a good fix.
I don't live off of 5k a month.

If he tries to get them to risk their home, I would file a police report for financial exploitation of vulnerable seniors.

Is there any particular reason your parents won't say no to your brother?

Is your brother disabled in some way? If so is he receiving SSDI?

Yours may be a question for an elder law attorney or Medicaid planner for their state.

It really depends upon the kind of POA they have, the wording and their competence.

I hope you have explained to them that they will be disqualified from receiving Medicaid assistance due to gifting, unless they have a legally promulgated "caregiver contract" whereby your brother is being paid for his services to them.

Have you made it clear to them (and resolved it in your own mind) that YOU will not be stepping in when they need more care?

If they are competent, they are free to make dumb choices and suffer the consequences.