Who are reverse mortgages designed for?
They are designed for homeowners 62 years and older who occupy their home as a principal residence.

Can a reverse mortgage be taken out if there is already a mortgage on the home?
Yes, but an existing mortgage must be paid off first and at closing.

What types of properties are eligible for a reverse mortgage?
Mobile homes and cooperatives are not eligible. Also, vacation homes and manufactured homes not attached to a permanent foundation.

Will I have any tax liability for the reverse mortgage proceeds?
The Internal Revenue Service treats monies from a reverse mortgage as a loan advance, not income. Loan advances are typically not taxable. We do advise you to consult with your tax advisor for questions relating to reverse mortgages and taxes.

How do monies from a reverse mortgage affect Social Security, Medicare or pension benefits?
Monies received from a reverse mortgage do not affect these types of benefits. We advise you to consult with you tax advisor if you are unclear about these benefits.

What are the out-of-pocket costs associated with a reverse mortgage?
The cost to get a reverse mortgage is similar to many of the same costs associated with a home purchase loan or refinance. The charges that you can expect to see on your settlement statement include an origination fee, appraisal and inspection fees, title policy, mortgage insurance and other normal closing costs. All of these costs can be financed as part of a reverse mortgage.

What is due when the loan is repaid?
The borrower must repay any loan advances received plus any interest accumulated.

What if I owe more than my home is worth?
You can never owe more than what your home is worth because all reverse mortgages are “non-recourse” loans.

Does the lender take the house?
No, the title to the property remains in the name of the borrower. The loan must be repaid when the last surviving borrower dies, sells the home, or no longer lives in the home as a principal residence.

What are my responsibilities as a borrower with a reverse mortgage?
The borrower is responsible for property taxes, insurance, utilities, maintenance and other expenses associated with owning a home.

When does the loan become due and payable?
The loan must be repaid when the last surviving borrower dies, sells the home, or no longer lives in the home as a principal residence.

Do I, or my heirs have to sell the property to repay the loan?
No, repayment to the lender can be accomplished by refinancing the reverse mortgage or by a conventional mortgage loan.