Fact: Closing costs such as origination fees, mortgage insurance premiums, and servicing fees, are in line with other government mortgages like FHA, VA, and USDA.

The advantage with a Rverse Mortgage is the borrower will never owe more than your home is worth so if you stay there another 20 years, make no payments while continueing to live there, the mortgage insurance protects you from owing more than the home is worth. Refinancing or taking out a mortgage for a new purchase will always come with closing costs. 

Fact: If inheritance to your heirs is important, using the proceeds from a Reverse Mortgage Line of Credit instead of using other assets like stocks, bonds, IRA's, etc. will give heirs access to inheritance quicker from liquid cash accounts vs. listing a home for sale and waiting to close.

Also, this way if any repairs are needed to get top dollar for selling, heirs will have other means to pay for the repairs and possibly make more on the sale of the home in an increasing market.

Fact: Everyone who wishes to apply for a Reverse Mortgage is required to go through a third party HUD Counseling session. This is to make sure the borrower understands all aspects of the mortgage and the opportunity to ask as many questions as they need. 

As far as risky, in times of inflation the reverse mortgage can be a hedge agains your other assets allowing them to recover in down markets. Also, once the Reverse Line of Credit is issued, it cannot be taken away like a HELOC and there is no required Mortgage Payment allowing for better cash flow.

Fact: Medicaid is determined at the state level. Social Security Income and Medicare benefits are not affected by how much you receive from a reverse mortgage.

Fact: Unlike a home equity line of credit (HELOC), a reverse mortgage line of credit is irrevocable. This means that the lender can’t cancel or reduce it because of changes in the economy, your finances, or your home’s value. You aren’t in danger of losing access to a reverse mortgage line of credit like you are with a HELOC.

Fact: You are required to use the home as your primary, but you always have the flexibility to relocate or downsize. In fact you can use a Reverse Mortgage for Purchase if you would like to downsize which will allow you to put less of a down payment and no mortgage payment.

After a borrower passes or moves to an assisted living, the family has the opportunity to pay off the loan, or sell the home. If the loan is more than the value, the heirs have the opportunity to refinance for 95% of the appraised value even if the current loan balance is higher. The bank does not hold the title, and can only sell the home with a Foreclosure. The heirs have 6 months to a year to sell the home after last borrower has passed or they have moved out of the home.

Fact: Since the borrower will never owe more than what the home is worth, the borrower has the opportunity to stay as long as possible and keeping in tact their cash flow from no mortgage payment. Most seniors (93%) that take out the loan are extremely satisfied with doing so.

Fact: If you are only planning to stay in the home 2-3 years, it may not be the best option. But if you have substantial equity, and would like to purchase another home with the equity, the reverse mortgage could be used as a good source for the funds. Or if you need repairs or cash for other expenses, the reverse mortgage is a great option with no required mortgage payment. 

Fact: If that happens your heirs will not be responsible for paying back the difference.  If values decline significantly, the borrower and heirs are protected with the Reverse Mortgage while still not being required to make monthly mortgage payments.

Fact: Not true! If there is a co-borrower, they are allowed to stay in the home and continue to use the line of credit after the other spouse has passed.

In the case of a non-borrowing spouse, they are allowed to continue living in the home until they pass or move to another property. They will have to continue paying the property taxes and homeowners insurance, will not have access to the line of credit but are allowed to stay.

Fact: You are always on title and Reverse Mortgage lien is the same as any other mortgage.