When Do I Pay Back the Loan?

A reverse mortgage does not have to be repaid until the borrower or borrowers permanently leave the home. As long as at least one of the borrowers maintains the property as their primary residence and continues to pay the property taxes and insurance, the loan does not come due. If the borrower decides to sell the home, or once both borrowers have passed away, or they no longer reside in the home as the primary residence, the loan will need to be repaid.

At the time of the loan repayment, the borrower or their heirs repay the amount of money that was borrowed, including fees, along with the accrued interest. This can be done by refinancing the property, or selling the property and paying back the loan. The loan can be refinanced by a conventional loan, if the heirs wish to keep the property.

This means the borrower can never owe more than the value of their home, no matter what the balance is. This feature protects the borrower or their heirs from ever having to pay back a loan balance that exceeds their property value.