Frequently Asked Questions

 

1.What is a reverse mortgage?

 A reverse mortgage is a loan that enables senior homeowners, age 62 and older, to convert part of their home equity into tax-free* income-without having to sell their home, give up title , or make monthly mortgage payments. The loan only becomes due when the borrower permanently leaves the home.

* Consult Tax Advisor. Not all products available in all states.

 

2. How does a reverse mortgage differ from a home equity loan?

Both a reverse mortgage and a home equity loan use the equity you have built up in your home.

They differ in that with a home equity loan you must make regular monthly payments of principal and interest. However, with a reverse mortgage you do not make any monthly mortgage payments for as long as you stay in the home.

 

3. What are the advantages of a reverse mortgage?

Remain independent. A reverse mortgage allows you to remain in your home and retain home ownership.

Stay in your home. It allows you to remain in your home and retain home ownership.

No monthly mortgage payments. You need not pay back the reverse mortgage loan nor make any monthly mortgage payments until you permanently move out of the home.

Tax-free money. Because the money you receive from a reverse mortgage is not considered income, it is tax free* and will not affect your Social Security or Medicare benefits.

Freedom and flexibility. The money you get from a reverse mortgage is yours to use in any way you choose.

* Consult Tax Advisor

 

4. When must a reverse mortgage loan be repayed?

Your reverse mortgage loan becomes due

• All borrowers permanently move out of the home
• The borrower passes away or sells the home;