PROS vs. CONS

PROS OF REVERSE MORTGAGES

Better manage expenses
Don’t have to move
Pay no taxes on the income from equity
If the Reverse Mortgage loan balance exceeds the value, you are protected
Can be used as an asset preservation strategy
Heirs have options when you pass or leave the property
Can be used as a delaying strategy for social security benefits until Full Retirement Age (FRA) is reached
Can be used for a Reverse Mortgage purchase

You have to pay expenses associated with obtaining a Reverse Mortgage loan
Interest on the loan isn’t deductible until the Reverse Mortgage is paid in full
Potential to violate other programs having asset restrictions
Your home can be foreclosed on if you fail to keep up on property taxes, homeowners insurance, or HOA fees
Changes with your status can create challenges with some aspects of your Reverse Mortgage: getting married, moving to a senior care community, etc.