The Basics
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The Basics: Fact and Fiction

There are several common misconceptions regarding reverse mortgages. Generally, these are due to a lack of understanding of the product. Here are some of the most commonly heard false impressions – and the facts – about reverse mortgages.

"The lender takes the title of my home."

The lender does not take the title of the home; you will retain ownership of the property. A reverse mortgage is simply a lien against the property.

"I can be evicted from my home."

Taking a reverse mortgage does not mean you are going to be forced from your home; you leave your home when you choose. A reverse mortgage loan is not due and payable until the home is no longer occupied as your primary residence. Until then, you live in the home, make no monthly mortgage payments, and use loan proceeds in any manner you choose. Even if you have used all of the funds available, you do not have to leave or sell the home. However, you are required to keep your home insured, pay your property taxes and maintain your home. You can use the proceeds from the loan to do so. Failure to meet these obligations could result in a default on your loan and possibly even foreclosure or a tax sale, so it is very important you understand and plan for these requirements.

"I could owe more than the value of my home."

Reverse mortgages are "non-recourse" loans, which means that you, your heirs, or your estate can never owe more than the appraised market value of the home at loan maturity. If the loan balance exceeds the appraised market value of the home, you, your heirs or your estate will only be obligated to repay the appraised value of the property at the maturity of the loan.

"My heirs will be against this."

We recommend that you discuss the loan with your family, friends, and/or other trusted advisors to decide if this is the right decision. This is your decision, but you want your family members to be supportive.

"My spouse will have to move out if I relocate to a nursing facility."

Borrowers will not be forced to move from their homes. As long as your spouse is on the title to the property and a borrower, he or she can remain in your home as long as he/she chooses.

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To speak with a Countrywide Reverse Mortgage Solutions Advisor, call 1-800-959-3789.