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Top 10 reverse mortgage myths dispelled

As reverse mortgages

 

have increased in popularity, so have the myths about these unique
loans. While there's better information available today, many seniors and their adult children

who are exploring reverse mortgages still encounter a host of misconceptions. Here's a look at

common myths and the facts:


1. The bank takes the house or the borrower can lose the house.

With a reverse mortgage, the borrower retains title throughout the life of the reverse mortgage. The borrower cannot, as

a result of the reverse mortgage, be forced out of the home as long as property taxes and insurance are paid and the home

is maintained in reasonable living condition. Once the borrower permanently moves out of the home, the loan must be

repaid. Most properties secured by reverse mortgages still have equity when a maturity event occurs; the borrower or heirs

can opt to sell the home to repay the loan and preserve this equity for the benefit of the borrower or his/her estate.

2. The home must be paid off or be debt-free to qualify.

Reverse mortgages convert home equity into cash. As long as ... more

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