FREQUENTLY ASKED QUESTIONS
Answers to Frequently Asked Questions about Reverse Mortgages.
Click on a question below to reveal the answer.
Can I use a Reverse Mortgage to pay off the balance of my current mortgage or home-equity loan?
YES. You can use the proceeds for whatever you want.
Does the lender take ownership of the deed/title to my home?
NO. The title on a reverse mortgage is no different than any other mortgage——only the homeowners are on the title.
Will I be taxed on the amount I receive from the bank?
NO. The money you receive from a reverse mortgage is tax-free. Please consult a tax advisor for more specific information about your tax situation.
Do you have to make loan payments back to the bank on a reverse mortgage?
NO. There are no payments required as long as you live in your home.
How much equity do I need to have in my home to qualify?
The amount of home equity required depends upon the age of the youngest borrower. The older you are the less equity you need to qualify.
Will my Social Security and/or Medicare benefits be reduced if I obtain a reverse mortgage?
NO. It will not affect your Social Security or Medicare Benefits.
Will a Reverse Mortgage cause me to owe more than my home is worth?
NO. Reverse mortgages are “non-recourse” loans, which means that the borrower can never owe more than the value of the home regardless of the loan balance.
What happens if one spouse passes or has to leave the home?
Recent FHA changes have made Reverse Mortgages safer for the surviving spouse. Generally, the loan does not have to be repaid until the last surviving homeowner passes away or leaves the home. At that time, the estate may repay the balance of the reverse mortgage within a specified period, or sell the home to pay off the balance.