Repaying the Loan
As long as you live in your home and it serves as your primary residence, you remain the homeowner. You have the right to sell the home and move at any time, and keep any proceeds that exceed what you owe the lender on your reverse mortgage.
The reverse mortgage loan repayment process does not have to begin until one of the following occurs:
- All borrowers permanently move out of the home
- The last surviving borrower passes away, sells the home, or fails to live in the home for 12 consecutive months
- The borrowers fail to pay property taxes or insurance
- The borrowers let the property deteriorate beyond what is considered reasonable wear and tear, and do not correct the problems
At this time, the loan balance - which includes any fees that have been added to the principal and the accrued interest on the total principal balance - needs to be repaid. This is typically accomplished by selling the house or other assets. Reverse mortgage repayment through a conventional mortgage is another option.