What happens if you live too long on a reverse mortgage?

What happens if you live too long on a reverse mortgage?

Reverse mortgages are a popular option for seniors to access home equity and boost retirement income. But what happens if you live a long, healthy life after taking out a reverse mortgage? Will you eventually "run out of house"?

Here's a breakdown of what to expect:

No Set Loan Term

Unlike traditional mortgages with fixed repayment schedules, reverse mortgages don't have a set term. You can continue living in your home for as long as you meet the loan obligations, which typically involve staying current on property taxes, homeowners’ insurance, and maintaining the property.

Accessing Funds

There are three main ways to access funds with a reverse mortgage: a line of credit, a fixed sum payout, or monthly installments. The total amount you can borrow is based on your age, home value, and current interest rates.

Potential for Depleted Funds

While there's no deadline to repay, it's possible to exhaust the available funds from your reverse mortgage, especially if you live a very long life and choose to withdraw larger amounts initially. This wouldn't force you to move out, but you wouldn't be able to access additional funds through the reverse mortgage.

Planning for Longevity

Here's how to prepare for a long life with a reverse mortgage:

• Conservative Withdrawals: Consider taking smaller, more strategic withdrawals to make the funds last longer.
• Other Retirement Income: Explore other sources of retirement income like Social Security, pensions, or part-time work to supplement your reverse mortgage funds.

Living Long with a Reverse Mortgage

A long life with a reverse mortgage doesn't have to be a financial burden and you can’t lose your home even you live to 150.

To learn more about reverse mortgages and to find out if one is right for you visit https://reganteam.com/reverse-mortgage/ or call 707-508-8473