When to pay back reverse mortgages
Reverse mortgages are payable only when the last surviving borrower dies, sells the property, permanently moves out or when he reaches the end of the loan period. A permanent move is implied when you, the co-borrower, or a qualifying relative has occupied the home for at least 1 year. If you die, the lender will not be able to take the title if your heirs can repay the loan.
When the loan may be in default
The loan will be in default if:
- You or the co-borrower have filed bankruptcy.
- The borrower donates or abandons the home
- You haven't paid property taxes
- You haven't maintained your home or paid for repairs
- Your home is no longer insured
- A co-owner has been added to the property title
- You have rented out the property to a non-relative
- You have taken a new loan on your home
- You have changed the property's zoning classification
Last updated on September 8, 2013