Reverse Mortgage

[jimenright]

I believe I've read some recent posts concerning reversed mortgages that were not properly answered. I would like to make a few points.

1. Interest on a reverse mortgage is not paid untill the property is sold. At that time it is treated in the same way as home equity interest.

2. Often mortgage insurance premiums are charged and reported on a 1098 and can be deductible according to current rules.

3. Loan origination fees may be charged may be deductible according to the rules for deducting points.

4. Check this website www.reversemortgage.org for a lot of info about reverse mortgages.

[Gene V]

some more information

From Pub. 17

Reverse mortgages. A reverse mortgage is a
loan where the lender pays you (in a lump sum,
a monthly advance, a line of credit, or a combi-
nation of all three) while you continue to live in
your home. With a reverse mortgage, you retain
title to your home. Depending on the plan, your
reverse mortgage becomes due with interest
when you move, sell your home, reach the end
of a pre-selected loan period, or die. Because
reverse mortgages are considered loan advances
and not income, the amount you receive
is not taxable. Any interest (including original
issue discount) accrued on a reverse mortgage
is not deductible until the loan is paid in full. Your
deduction may be limited because a reverse
mortgage loan generally is subject to the limit on
Home Equity Debt discussed in Publication 936.