My Perfect Mortgage
Can You Lose Your House with a Reverse Mortgage
4 minute read
May 22, 2023

The short answer to the question, "Can you lose your house with a reverse mortgage?" is no; you cannot lose your house due to foreclosure or non-payment of the reverse mortgage loan.

However, this only applies when you meet the obligations of the loan—such as paying property taxes, maintaining homeowner's insurance, and keeping the home in good condition.

We'll explore more about how a reverse mortgage works and how you can stay in your home as long as you want.

Connect with a reverse mortgage expert.

Remain in your home

One of the critical requirements for a reverse mortgage is that you must continue to live in the home—make it your primary residence—and spend the majority of your time living there.

If you were to live elsewhere for most of the year or move to an assisted living facility for over 12 months? Then the loan becomes due.

This rule doesn’t mean you never leave your own home.

For example, “snowbirding”—temporarily relocating to a warmer climate for the winter months—or going on vacations won’t likely be a problem.

As it turns out, most senior Americans want to continue to reside in their homes for as long as possible—making a reverse mortgage a potential win-win situation for everyone.

Here are some strategies for making sure you can stay in your home when you have a reverse mortgage.

Strategies to remain in your home

To remain in your home and keep your reverse mortgage in good standing, consider the following:

  • Modifying your home in order to accommodate your changing needs as you age, such as installing grab bars, ramps, or wider doorways.
  • Engage in-home care services if you require assistance with daily activities or medical needs.
  • Utilize a property manager or caretaker if you need help with home maintenance tasks.

Pay property taxes

One of the main obligations of a reverse mortgage is to pay your property taxes.

Failing to pay property taxes—in any situation, not just for reverse mortgages—will likely result in the county or municipality seizing your home for non-payment.

Pretty much every reverse mortgage lender will require you to pay property taxes to ensure that your home remains a secure investment.

To avoid any issues, make sure your home budget includes enough funds to afford your property taxes—and make your schedule set to pay them in a timely manner.

Find out if you qualify for a reverse mortgage.

Keep your homeowner's insurance policy active

Another condition of a reverse mortgage is that you must maintain an active homeowner's insurance policy.

This policy helps protect your home and the lender's investment should your home suffer damage or be destroyed. In the event of damage or destruction, an insurance policy allows you to rebuild your home and continue living there.

Maintain the home

Maintaining the home is another requirement for a reverse mortgage. A reverse mortgage lender will want to ensure that the property remains in good condition, as it serves as collateral for the loan.

Maintaining the condition of the home means that you must perform regular maintenance tasks—such as fixing leaks, repairing damages, and addressing safety hazards.

Reverse mortgage FAQs

What if you can't meet reverse mortgage requirements?

If you're unable to meet the reverse mortgage requirements, the loan may become due and payable. In this situation, you'll need to work with your reverse mortgage lender to find a suitable solution, such as selling the home or refinancing the mortgage. You will typically be allotted some time to work out repayment.

How long do you have to sell or refinance if you don't meet reverse mortgage requirements?
Do you still own the home when you get a reverse mortgage?

See if a reverse mortgage is right for you

You don't need to worry about losing your house when you get a reverse mortgage. In fact, it can be one of the most effective tools to help you keep it since no monthly payments are due.

By meeting the loan requirements—remaining in the home, paying property taxes, maintaining homeowner's insurance, and keeping the home in good condition—you can ensure that your reverse mortgage remains in good standing.

The reverse mortgage is a powerful resource for older people who are seeking to stay in their homes despite rising costs and fixed incomes.

Is a reverse mortgage right for you or your loved one? Find out today.

Our advise is based on experience in the mortgage industry and we are dedicated to helping you achieve your goal of owning a home. We may receive compensation from partner banks when you view mortgage rates listed on our website.