Reverse Mortgage Pros And Cons
- You continue to live and own the home as your primary residence as long as you maintain the payment of property taxes, insurance, condo association dues (if applicable) and any maintenance, all with $0 monthly mortgage payments.
- You receive tax-free money which generally does not affect SS or Medicare. We do recommend you consult with a financial or tax advisor, as each situation varies.
- Your income and credit requirements are minimal.
- You nor your heirs will be personally liable for repayment of the loan, in excess of the home value, at the time of sale.
- You have no prepayment penalty.
- Your money can be used for any purpose such as eliminating your housing payment, supplementing your income, paying for home repairs or remodeling, paying off credit cards, future expenses, healthcare, travel and spoiling your grandchildren.
- You may have slightly higher up front fees than that of a traditional mortgage or home equity loan.
- The equity available to your heirs may be reduced.
- It may affect your ability to obtain need-based government assistance benefits. (i.e. Medicaid)
- Your loan may become due and payable in full if certain terms of the mortgage are violated.
- Unless you make the interest payment, you may not deduct any accrued interest on your income taxes until the loan is paid in full.