Ten Great Facts About Reverse Mortgages

A reverse mortgage has no income, credit, or health requirements
The lender will not own your home. You and your family or your estate continue to retain ownership of your home. The lender does not take control of the title. The lender's interest is limited to the outstanding loan balance.
Reverse mortgage borrowers may remain in the home for as long as they wish. However, should they decide to sell the home for any reason, the loan would then become due and payable.
Reverse mortgages do not require any monthly payments. The borrower is responsible for payment of taxes, insurance, and general upkeep of the home and nothing more.
Your heirs will not be left to repay the loan out of their own pockets. The reverse mortgage is a non-recourse loan. This means that the lender can only derive repayment of the loan from the proceeds of the sale of the property. You or your heirs can never owe more than the value of the home, regardless of the loan balance. The same rule applies if a catastrophe struck and the value of the home is reduced.
You may have a mortgage or other debt on your home and receive a reverse mortgage. However, the mortgage or debt must be paid off first with the proceeds of the reverse mortgage, meaning that the debt will simply reduce the amount of money that you can borrow. Many people actually get a reverse mortgage to pay off their homes and to get rid of their monthly payments forever.
You can get a reverse mortgage and still have money left over to pass on to your children. You can choose how much to borrow. Realize that your property will continue to appreciate (the whole value of the estate) and you pay interest on only the smaller amount borrowed. Please consult your representative for amortization tables that might apply to your specific situation and to find out how much you could still leave as inheritance.
You can still decide to sell your house. If you do decide to sell, the reverse mortgage is like any other loan that must be paid off at closing. There are no restrictions on prepayment or penalties for paying off your loan or selling your home.
Your loan terms will not change, unless you choose to refinance. A reverse mortgage is secured by two deeds of trust. Once executed, the terms are defined and cannot be changed as long as the deeds remain in force.
Your Social Security, Medicare/Medicaid benefits will not necessarily decrease.Generally, the money from a reverse mortgage is considered borrowed money and not income. For some programs, monthly draws must be spent and not accumulated, but for most the money is not considered disqualifying. Please consult with an advisor or your local Agency for Aging for your specific situation.

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