|
| Q. To avoid probate, my children and I own the property in joint tenancy. Do we qualify? |
| Yes, if the children are age 62 and older
and live in the property. Otherwise, they would need to be taken off
the title before settlement (a simple task). |
|
| Q. Does the IRS treat monthly advances from a reverse mortgage as taxable income? |
| No. The cash advances are actually loan distributions and are not considered income. The cash advances are tax-free. |
|
| Q. Are mobile homes eligible for a reverse mortgage? |
| Yes. The home must have been built after 1976 and have a permanent foundation that is approved by the FHA. |
|
| Q. My spouse is permanently in a nursing home. Can we participate? |
| Yes. Only one owner is required to occupy the property as their principal residence. |
|
| Q. Are there restrictions on how I can use the money? |
| No. It's your choice to spend the money as you see fit. |
|
| Q. Can the lender take my home away if I outlive the loan? |
| No. You do not need to repay the loan as
long as you, or one of the borrowers, continue to live in the house and
taxes and insurance are current. You can never owe more that your
home's value. |
|
| Q. Will I still have an estate that I can leave to my heirs? |
When you sell your home or no longer use it
as your primary residence, you or your estate will repay the cash you
received from the reverse mortgage, plus interest and other fees, to
the lender. The remaining equity in your home belongs to you or to your
heirs. None of your other assets will be affected by the reverse
mortgage.
This debt will never be passed along to the estate or your heirs.
Your heirs will be able to choose whether to keep the house or sell it.
If they decide to keep the home, they must pay the balance due on the
reverse mortgage, or they may sell the home and use the proceeds to pay
off the remaining mortgage. They get to keep any excess proceeds from
the sale of the house. |
