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Common Questions

Reverse Mortgage FAQ

Answers to common questions about FHA-insured reverse mortgages.

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Common Questions about Reverse Mortgages

The most important question is “How do people use a reverse mortgage?” and Rick answers it in the video at right. For most senior homeowners, the answer is the same: eliminate mortgage payments, increase cash flow and use the money any way you like. You can also use a reverse mortgage to purchase a new home as your primary residence.

Scroll below or click a question to jump to the answer or watch brief videos:

The best way to get answers to your specific questions is to Call or contact Rick Today.



Q: Does the bank own my home?

A: This is without a doubt the number one misconception. No, the bank never owns your home. You remain the owner of your home and can stay as long as you wish. As the homeowner, you must continue to pay property taxes, home insurance, and continue with basic home maintenance during the loan period – that’s it. When the home is sold, the loan is repaid (including accrued interest and any fees) all remaining equity goes to you or your heirs.


Q: Will my children lose their inheritance when their parents, the borrowers, pass on?

A: The loan becomes due and payable when both borrowers or a borrower and surviving spouse no longer live in the home due to having passed on or because they have moved to long-term care and have vacated the home for over 12 months. Normally, the home is sold, the loan (including interest and any fees) is repaid, and any remaining equity goes to you or your heirs.

  • If both have passed on, heirs will have 12 months to sell the house and pay off the mortgage or refinance it with a conventional mortgage to keep it.
  • surviving spouse is protected from having to vacate the home if the borrowing spouse passes on first or needs to live in assisted living.

Q: How much of a loan am I eligible for?

A: Three factors are considered to calculate how much equity you can access:

  • Age of the youngest borrower
  • Home value
  • Current interest rates.

Although we use the home value you initially provide us to calculate the preliminary loan amount, an independent appraiser must visit your home to ascertain the current value of your home. We then re-calculate the loan amount according to this official home value. All this will be organized by Rick May, your personal reverse mortgage planner. 

Q: What if I already have a mortgage?

A: That’s absolutely fine. If you qualify, a reverse mortgage will first pay off your existing mortgage and then give you the remaining proceeds. In fact, many of our borrowers use a reverse mortgage for that purpose – to eliminate monthly payments on their traditional mortgage.

Q: Are there any income/credit score requirements?

A: Because you don’t make any monthly mortgage payments, only proof of income to support your other regular monthly charges will be assessed, i.e, income sufficient to pay property taxes, insurance, and general upkeep of the home.​ A credit report will only be used to check for tax liens or other items that may affect qualification.

Q: Does a Reverse Mortgage require that I make monthly payments?

A: NO. There are never any monthly mortgage payments. However, payment of taxes, insurance and general upkeep of the home are the responsibilities of the homeowner. The loan becomes due when the youngest borrower permanently moves out of the home.