Common Questions
Yes — if you fail to pay property taxes, homeowners insurance, or fail to maintain the property. These are conditions of every reverse mortgage. Lenders can initiate foreclosure if these conditions aren't met, even if you're current on no-payment loan. This is the most misunderstood risk — the "no monthly payment" feature doesn't mean no financial obligations.
Reverse mortgage proceeds do not affect Social Security or Medicare benefits — they are loan proceeds, not income. However, if reverse mortgage funds are not spent in the month received and accumulate as liquid assets, they may affect Medicaid or Supplemental Security Income (SSI) eligibility — both of which have strict asset limits. Consult a benefits counselor if you receive Medicaid or SSI.
Yes — your heirs have 6–12 months after your death (or permanent departure from the home) to repay the reverse mortgage and keep the home. They can refinance it with a traditional mortgage, sell the home and repay from proceeds (keeping any remainder), or walk away if the loan balance exceeds the home's value. Heirs never owe more than 95% of the home's appraised value.
The right time depends on your individual situation, not market timing. Rising interest rates reduce the principal limit available (you access less equity), while falling rates increase it. However, the primary value of a reverse mortgage comes from eliminating payments and accessing equity — factors that don't depend on rate cycles. If you need the income or want to eliminate the payment, waiting for rate declines may cost you years of benefit.