Reply to Parents out of money at 75

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[quote=Anonymous][quote=Anonymous]My in-laws have just revealed to us that they have depleted their savings and are living 100% on social security. They have a paid for house and can manage their routine expenses with what they get from SS, but recently needed a $20k home repair which is how this situation came to light. We can provide them with the money they need for the repair, but I want to set it up as a loan against their home equity (roughly valued at $350k). Does that sound reasonable? How would you go about documenting such an arrangement?

Knowing that they're out of money, any recommendations on what we should be factoring into our own finances to help them navigate the next phase of life? Any financial burden will fall to us and I'm worried this is going to change our own retirement planning...[/quote]

You could structure it as a secured loan.  Draft a promissory note (with interest that accumulates even if they don't pay you anything) and have a security interest recorded against their house for $20k plus interest.  When they pass, their estate will have to pay it back when the home is sold and only the net proceeds get divided to their designated heirs. [/quote]

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