Top 10 Reverse Mortgage Myths Dispelled

Posted by News Feeds

September 14, 2007

Top 10 Reverse Mortgage Myths Dispelled,

As reverse mortgages have continued to grow in popularity, so have a range of myths and misinformation about these unique loans.Fortunately, there’s more and better information available today than just a few years ago. However, as many seniors, the adult children of seniors and advisors are exploring reverse mortgages, some old myths still linger and new myths have emerged. Listed below are some of the most common misconceptions along with a few facts:

(1). The bank takes the house OR the borrower can lose the house.

With a reverse mortgage, the borrower retains title to the home throughout the life of the reverse mortgage. The borrower cannot, as a result of the reverse mortgage, be forced out of his or her home as long as property charges such as taxes and insurance are paid and the home is maintained in reasonable living condition.

Once the last 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 and therefore the borrower or his/her heirs can choose to sell the home to repay the loan and preserve this equity for the benefit of the borrower or his/her estate.

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