A reverse mortgage must be repaid if the home is unoccupied by the borrower for how long?

A reverse mortgage is a financial product that allows older homeowners to convert part of their home equity into cash without having to sell their home. One of the key stipulations of a reverse mortgage is that it must be repaid under certain conditions, including if the borrower moves out of the home or no longer occupies it.

When it comes to occupancy, a reverse mortgage generally requires the borrower to live in the home as their primary residence. If the home is unoccupied for 12 consecutive months, this indicates that the borrower has likely moved out or no longer meets the occupancy requirement. In this scenario, the reverse mortgage becomes due and payable.

This requirement serves to protect the lender's interests, ensuring that the property isn't left unattended for extended periods, which increases the risk of damage and reduces the overall value of the home. In essence, a 12-month absence signals that the borrower might no longer be in a position to manage the terms of the reverse mortgage, necessitating repayment to secure the lender’s investment. This understanding of occupancy requirements is critical for anyone working with reverse mortgages or advising clients in real estate and mortgage practices.