The very nature of a reverse mortgage can be confusing. With a reverse mortgage lenders pay you either monthly or with one lump sum. The following lists provide information regarding repayment of a reverse mortgage.
A reverse mortgage comes due when under the following conditions:
Death of the homeowner
Upon sale of the home by the homeowner
If the homeowner lives elsewhere for 12 consecutive months (i.e. assisted living home)
Upon one of the instances of default listed below.
When the reverse mortgage becomes due there are two options for paying it off.
Proceeds from the sale of the home
The heirs of the homeowner can refinance the loan
Like all loans a reverse mortgage does carry conditions in order to remain valid. Below is a list of reasons for which a borrower would find themselves in default.