Myth 1: The lender owns your home.
Fact: With a reverse mortgage, you retain full ownership of your home. The loan simply places a lien on your property, which is repaid only when the home is sold, you move out, or the loan reaches maturity. You remain in control of your property, including how you maintain and manage it.

Myth 2: Your heirs will be left with nothing.
Fact: Heirs can inherit any remaining equity after the loan is repaid. While the reverse mortgage must be settled upon the borrower’s passing or move-out, any excess equity beyond the loan balance can be passed to family members. Proper planning ensures your loved ones still benefit from your home.

Myth 3: Reverse mortgages are only for financially struggling seniors.
Fact: Reverse mortgages are a financial tool for a wide range of retirees, not just those in need. Many homeowners use reverse mortgages to supplement retirement income, cover healthcare costs, or enjoy lifestyle flexibility while maintaining ownership of their home.

Myth 4: You cannot sell or move if you have a reverse mortgage.
Fact: Borrowers can sell their home or move at any time. The loan balance must be repaid when the home is sold or if the borrower permanently moves out, but you retain the right to relocate or downsize whenever it makes sense for your life or financial goals.

Myth 5: Reverse mortgages are too expensive.
Fact: While there are costs associated with reverse mortgages, such as origination fees, closing costs, and mortgage insurance for HECM loans, these costs are often comparable to traditional mortgages. The benefits of accessing home equity without monthly payments often outweigh the expenses for qualified borrowers.

Myth 6: You lose control over how you receive your funds.
Fact: Reverse mortgage proceeds can be customized to fit your needs. You can choose from lump sums, monthly payments, lines of credit, or a combination of options, providing flexibility to manage your finances in a way that best supports your retirement goals.

Myth 7: You can’t get a reverse mortgage if you still have a mortgage.
Fact: Existing mortgage balances can be paid off with the proceeds from a reverse mortgage. This is one of the most common uses of reverse mortgage funds—allowing homeowners to eliminate monthly payments and improve cash flow while retaining homeownership.

Myth 8: Reverse mortgages are risky and complicated.
Fact: When structured properly with expert guidance, reverse mortgages are a safe and regulated financial tool. With Tom Spaniel Reverse Mortgage, we provide clear explanations, counseling, and step-by-step support to ensure borrowers fully understand the program, the obligations, and the benefits.