Mortgage Refinancing - Reverse Loan Features

Reverse mortgage loan advances are not taxable, and generally do not affect Social Security or Medicare benefits. You retain the title to your home and do not have to make monthly repayments. 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. In the HECM program, a borrower can live in a nursing home or other medical facility for up to 12 months before the loan becomes due and payable.

These are the basic steps and features regarding a reverse mortgage.

Borrower seeks information from lender, but must be age 62 to participate.
Counseling provides borrower with information on reverse mortgage, including eligibility and other available options.
Borrower fills out application, selects payment options, is provided estimated costs of loan and pays for appraisal.
An appraiser determines the value and condition of property.
If approved, the closing is scheduled. Closing costs and fees incurred can be financed as part of the loan; there is zero to minimal out of pocket costs to you.
Borrower has access to the funds according to the option selected.
No repayment is made until the home is sold or the owner permanently moves out or passes away.
You will never owe more than the value of your home.
There is no income qualification.
Interest is paid at the time the loan is repaid.
When the loan is due, your heirs have choices—they can repay the loan and keep the house, or sell the home and repay the loan.
You own your home—the lender does not take control of the title.
Interest rates are adjustable and can change periodically; however, this does not affect the amount you will receive.