5 Reverse Mortgage Myths That Just Aren't True

Myth 1: “The bank takes ownership of my home”

Not true. You keep the title the entire time. A reverse mortgage places a lien against your home, just like a traditional mortgage does — it does not transfer ownership.

Myth 2: “My heirs will inherit debt”

Not true. Both HECM and HomeSafe are non-recourse loans — neither you nor your heirs will ever owe more than the home is worth when the loan comes due, regardless of how large the balance has grown.

Myth 3: “I have to make monthly payments”

Not true, with a condition. There is no required monthly mortgage payment as long as you live in the home as your primary residence and keep property taxes, homeowners insurance, and HOA dues current. Falling behind on those obligations — not the loan itself — is what can put the home at risk.

Myth 4: “It’s only for people who are desperate for cash”

Not true. Reverse mortgages are increasingly used as a deliberate retirement-planning tool — a standby line of credit, a way to delay drawing down investment accounts in a down market, or a way to buy a new home without a monthly payment. It’s a financial tool, not a last resort.

Myth 5: “The line of credit growth is like free money”

Not true, and this one matters. The unused portion of a line of credit can grow over time, but that growth represents a greater capacity to borrow in the future — it is not income, interest, or a return on your home’s value, and it is not guaranteed to grow indefinitely.

Get the real answers for your situation

Talk to us — we’ll tell you plainly what does and doesn’t apply to you.