A reverse mortgage is a loan for seniors age 62 and older. They are insured by the Federal Housing Administration (FHA) and allow homeowners to convert their home equity into cash with no monthly mortgage payments. borrowers must continue to pay property taxes and insurance and maintain the home according to FHA guidelines. Typically the loan does not become due as long as you live in the home as your primary residence and continue to meet all the loan obligations.

The loan does not generally have to be repaid until 6 months after the last surviving homeowner moves out of the property or passes away.  At that time, the estate typically sells the home to repay the balance of the reverse mortgage and the heirs receive any remaining equity. The estate is not personally liable for any additional mortgage debt if the home sells for less than the payoff amount of the reverse mortgage loan.

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