• Robb Downing

The Top 8 Misconceptions About Reverse Mortgages

Busting Reverse Mortgage Misconceptions

When it comes to financial planning – whether for retirement, home improvements, medical care, and beyond – there are a lot of unique options on the horizon for qualified homeowners.


The problem? With so many options at your fingertips, there’s bound to be some false information and misconceptions floating around out there. That means choosing the right plan for you can be tricky.


This proves to be especially true when it comes to reverse mortgages.

"Everyday we hear misconceptions from our clients about reverse mortgages. Our job as reverse mortgages specialists is to educate our customers so they know all the facts and can make the most informed decision possible to secure their financial futures." - Robb Downing, Reverse Mortgage Specialist


First Things First: What's a Reverse Mortgage?


It’s hard to cover the misconceptions without first going over some of the basics of reverse mortgages. So, let’s dive in and answer the question on the top of everyone’s minds – what exactly is a reverse mortgage, anyway?


A reverse mortgage is a type of loan available to homeowners 62 years or older who have a suitable amount of equity in their home empowering them to borrow a portion of that equity as tax-free income.



A reverse mortgage takes the terms of a traditional mortgage and swaps them around. Instead of the homeowner paying a lender, the lender pays the homeowner.


Why Would a Homeowner Want this Type of Loan?


To supplement their income, plan for retirement, meet medical expenses, make home improvements, and a myriad other reasons.


What are the requirements for taking out a reverse mortgage?


It will depend on the specific loan, of course, but generally, the basic requirements are:

  • The borrower must be at least 62 years old

  • The borrower must count the home they’re taking the loan out on as their primary residence

  • Equity needs to cover the amount the borrower needs for the reverse mortgage

  • The house has to stay in good condition

  • Homeowners must be able to pay taxes and insurance premiums on the property

The Top 8 Misconceptions About a Reverse Mortgage


  1. Reverse Mortgage Sells Your Home to the Lender

  2. A Borrower’s Heirs Won’t Inherit the Home

  3. The Homeowner Pays Taxes on the Money Received from a Reverse Mortgage

  4. Homeowners’ Reverse Mortgages Have Sizeable Out-of-Pocket Costs

  5. Borrowers Can Outlive a Reverse Mortgage

  6. Borrowers Can’t Lose Their Homes if They Violate Reverse Mortgage Terms

  7. A Reverse Mortgage is the Same as a Traditional Mortgage

  8. Borrowers Can’t Sell Their Homes if They Take Out a Reverse Mortgage