While reverse mortgages can sometimes provide seniors who cannot work with a steady income, they can also cause problems or even result in the eviction of family members following the main borrower’s death. If a borrower is forced to move out for medical reasons, they (or their families) must repay the amount borrowed or sell the property within six months. While surviving spouses are supposed to be protected from eviction following a borrower’s death, it doesn’t always work out this way in practice.
- When seniors are starved of income and low on funds, having a reverse mortgage can be a good way to get some funds.
- When one takes a reverse mortgage loan no repayments are due on the loans until it happens that the owner dies.
- One problem with reverse mortgage is that when the owner of the house dies or moves from the property, the family members have to pay the obligation.
“The loans, which enable homeowners to tap the equity in their dwellings, also can be complex and even lead to foreclosure.”