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When do I have to pay back the loan?
The loan becomes due and payable if one or more of the following conditions occurs:
1. The last surviving borrower passes away or sells the home.
2. All borrowers move out of the home permanently.
3. The last surviving borrower fails to live in the home for 12 consecutive months due to physical or mental illness.
4. The borrower fails to pay property taxes or insurance.
5. The borrower allows the property to deteriorate beyond what is considered reasonable wear and tear, and does not correct the problems.
If you outlive the loan, the loan is not due at that time. The loan does not have to be repaid as long as one borrower continues to live in the house, and keeps the taxes paid and insurance in force.
If you sell your home, the outstanding mortgage balance is due and payable. You will keep all proceeds exceeding your mortgage balance. There are no prepayment penalties on a Reverse Mortgage.
