Income Intermediate: Reverse Mortgages

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1.
With a reverse mortgage, _______.
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Financial counseling may be required as to the pros and cons. These loans can be complicated; regulators and lenders want to make sure they are well-understood.
2.
When considering whether to take out a reverse mortgage, you should consider your ability to keep the home in good condition because _______.
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The home may need to be sold to pay off the loan. In order to receive adequate payback, the lender will want to ensure that the home is attractive to buyers.
3.
All reverse mortgages are insured by the federal government.
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False. The majority are, but not all.
4.
If you take out a reverse mortgage, you are still required to pay for mortgage insurance.
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True. Your mortgage insurance premiums pay into a government insurance program designed to protect both you and the lender.
5.
Which of the following is true of reverse mortgages?
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Reverse mortgages are a type of loan that need not be repaid as long as you own your home. Since these are loans, the money you receive is tax-free.