Frequently Asked Questions:
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Frequently Asked Questions
Who is the reverse mortgage designed for?
It designed for homeowners at least 62 years of age with significant equity in their homes.
Can a reverse mortgage be taken out if there is already a mortgage on the home?
Yes, but the existing mortgage must be paid off from the proceeds of the reverse mortgage.
Will the lender own my home if I take out a Reverse Mortgage?
No, the homeowner retains title to their home throughout the life of the Reverse Mortgage.
Is it true that only those with excellent credit, income and/or health can qualify?
No, there are no credit, income or health requirements for a Reverse Mortgage.
Will I have any tax liability for the reverse mortgage proceeds?
The Internal Revenue Service treats money received from a reverse mortgage as a loan advance and not taxable income.
How does the money received from a reverse mortgage affect Social Security, Medicare or pension benefits?
The proceeds from a reverse mortgage do not affect these benefits.
Please consult with a tax professional and the respective state benefit provider.
If I take out a reverse mortgage will my SSI or Medicaid benefits be affected?
No, a reverse mortgage will not affect these or most other means tested benefits as long as the monthly cash advances are fully spent every month and not accumulated.
If there are no payments, what are my responsibilities as a borrower with a reverse mortgage?
You are required to pay your property taxes, keep current property insurance in place, and maintain the home.
When does the loan become due and payable?
The loan is due and payable when the borrower sells the property, permanently leaves the home, or passes away.
Will my heirs be responsible for repayment of the Reverse Mortgage?
No, the lender can only look for repayment from the sale of the property. The lender cannot look to the estate for repayment of the loan.
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