Reverse mortgages do not require borrowers to make monthly mortgage payments of principal and interest like conventional mortgages. Instead, interest builds up each month and is added to the loan balance. This means the total amount owed grows over time.
The full amount borrowed, plus interest, must be repaid when:
Reverse mortgages are “non-recourse” loans. This means borrowers or their heirs will never be liable for more than the home is worth when it is sold to repay the loan.
This article is intended for general informational and educational purposes only and should not be construed as financial or tax advice. For tax advice, please consult a tax professional. For more information about whether a reverse mortgage fits into your retirement strategy, you should consult your financial advisor.
