Reverse Mortgage

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Top 5 Reverse Mortgage Frequently Asked Questions

This is a great place to get started learning the facts about this important mortgage option.

Q. What is a reverse mortgage?

A. It’s available to homeowners age 62 or older that allows you to tap into the equity you’ve built up in your home. When you take out a reverse mortgage, instead of making monthly payments as with a forward mortgage, you receive cash for things you may need. The loan is not due until the last borrower leaves the home permanently.

Q. If I take out a reverse mortgage, will the bank own my home?

A. You continue to own and live in your home—the bank is merely extending a loan to you. Because you continue to be the homeowner, you remain responsible for payment of property taxes, hazard insurance and keeping the home in reasonable condition.

Q. What is the difference between a reverse mortgage and a home equity loan?

A. With a reverse mortgage there are no income or credit qualifications. What’s more, with a home equity loan or line of credit, you have to make monthly payments—with a reverse mortgage, you do not need to pay back the loan until the last surviving borrower leaves the home permanently. Although there are no monthly payments, interest accrues on the portion of the loan disbursed.

Q. How much money can I get?

A. The amount you can borrow depends on several factors, including your age, the type of reverse mortgage you select, current interest rates, the appraised value of your home and the Federal Housing Administration’s (FHA) lending limit for the area in which you live.

Q. What about the interest rates and fees?

A. Interest rates for most reverse mortgages are tied to a financial index and will vary according to market conditions. I can provide you with the interest rates for the various loan types and explain the potential implications of there rates based on your individual circumstances. Interest is charged only on the money you receive.

Additional costs typically include an origination fee, closing costs and a mortgage insurance premium. These can be rolled into the reverse mortgage and paid (with interest) when the loan becomes due.

Have more questions?


The following businesses are participating members of Delta County Senior Resource Council.


Brenda Toole at The Federal Savings Bank 970-497-6000

OR Val Begalle of Universal Lending  970-245-6404


You are urged to contact all programs in your area and become an informed consumer. See your local phone book for complete listings.