Can I Lose My Home with a Reverse Morgtage?
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The biggest fear that most people have when considering a reverse mortgage is that they will somehow lose their home. With stories of rising rates of foreclosure in the newspapers and on TV, it’s no wonder that borrowers are concerned. The good news, however, is that this is not really something that you need to worry about with a reverse mortgage.

First of all, you remain the legal owner and title-holder to your home. You have only promised that they can get back the money, plus costs and interest that you borrowed from them once you are no longer living in your home. As long as you remain healthy and in residence, your loan will not become due.

This applies even if you live longer than there is money left in the loan. If you use up the loan amount and continue to live in your home, no one has the right to take away your home or force the loan to be paid.
Of course, you do have certain responsibilities in order to make certain that your home remains yours. You are required to keep up payments for taxes and insurance, but you would need to at least pay your taxes and would probably still have insurance on your home even without a reverse mortgage. Naturally, you are also still responsible for keeping up with your utilities, home maintenance and other expenses, again as you would even without the loan.

A reverse mortgage only becomes due when the last borrower either sells the home or dies. The only exceptions to this are if:

1. The original borrower(s) move to different primary residence.
2. Illness causes the borrower(s) to be unable to live in the home for 12 months in a row.
3. The home is allowed to deteriorate beyond reasonable wear and tear and the borrower fails to take care of the maintenance needed.
4. The borrower(s) fail to pay required insurance, taxes, or other normal home payments.

Since more and more seniors are choosing reverse mortgages, there are more and more safeguards being built into the reverse mortgage process. There is even a group, the National Reverse Mortgage Lenders Association, dedicated to protecting the rights of seniors who take advantage of reverse mortgages. The many ways consumer protection elements that have been added to reverse mortgages in recent years have made them safer and more desirable an option than ever.

For added protection as a senior deciding to get a reverse mortgage, you can opt for the most popular type. The HECM is a reverse mortgage that is offered through the U.S. Department of Housing and Urban Development. HUD ensures that the Home Equity Conversion Mortgage is insured by the government and has extra safety measures built in to protect you as the borrower.

Some of the protections offered are standardized interest rates, fee limits, required disclosure of the total annual loan cost, required independent counseling, and no penalties for prepayment or loan cancellation within three days.
If you are aware of what is required of you and what your protections are, you can live happily in your home for the rest of your life.

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