Rest assured, you do not lose equity in a reverse mortgage. Reverse mortgage loans allow you to maintain ownership of your property. In fact, the majority of reverse loans are Home Equity Conversion Mortgages (HECMs), which are insured by the Federal Housing Administration (FHA). The FHA, a component of the Department of Housing and Urban Development (HUD), serves as the insurer of HECMs. Here are some key points to keep in mind:
Homeowners are still responsible for property taxes, insurance, and maintenance.
As long as you continue to meet the requirements, you can stay in your home without making monthly mortgage payments.
The loan balance increases over time, and the interest you accrue is added to the balance.
When you pass away or sell the home, the loan must be repaid. The remaining equity belongs to you or your heirs.
Overall, reverse mortgages can be a good option for senior homeowners looking to tap into their home equity while still maintaining ownership of their property. With the right information and guidance, you can make an informed decision about whether a reverse mortgage is right for you.