If you’re considering renting out your house, but you have a reverse mortgage, you must ensure you understand your obligations. There are specific reverse mortgage requirements that must be met to qualify for a reverse mortgage. One of the requirements stipulates that the home must be your primary residence. Read on to learn more about whether you can legally rent out your home if you have a reverse mortgage.
Reverse Mortgage Requirements
To qualify for a reverse mortgage in Oregon you must meet these requirements:
- You are at least 62 years old
- You have accrued significant equity in your home
- You will continue to pay your taxes, insurance, and any HOA dues
- You agree to maintain the home
- You receive HUD-approved counseling before obtaining a reverse mortgage
- You don’t already have a reverse mortgage
- The home must be your primary residence
Because one of the reverse mortgage requirements mandates that the home be a primary residence, you must live in the home more than half of the time. Of all the reverse mortgage requirements, it is this one that makes it difficult for owners of a single-family home to lawfully rent out their home. You are though, allowed to have a roommate, or rent a room to a friend or family member while you have a reverse mortgage. Keep in mind that different lenders have different rules, so be sure to check with them, to confirm you can bring in a roommate.
If you have a reverse mortgage on a single-family home, but spend months at a time elsewhere, it is very risky to try to rent the home out as a short-term rental property. Many lenders will prohibit using your home as an Air BnB, for example. Likewise, nearly all lenders limit the time you can reside away from your home to six months. In the case of a medical emergency, time spent away from your primary residence may be extended to 12 months.
However, if you own a multi-unit property such as a small apartment complex, or duplex, and live in one of the units, you are allowed to rent out the other units. This could be a greatly beneficial situation, as you can receive monthly payments for your reverse mortgage while earning rental income.
Is a Reverse Mortgage Right for Me?
Getting a reverse mortgage is a personal choice, that you may wish to discuss with your accountant, financial advisor, estate planning attorney, and mortgage advisor. Reverse mortgages allow homeowners with equity in their homes to access funds, which can be used for expenses, bills, medical care, and more. These unique loan products also allow older homeowners to stay in their homes, maintaining their residence and ownership. On the other hand, reverse mortgages will require closing costs. In other words, be sure you do your due diligence to determine if this type of loan is right for you.
Get Your Questions About Reverse Mortgages in Oregon Answered
If you meet the reverse mortgage requirements and would like to tap into the equity you’ve earned in your home, Strategic Mortgage Solutions can help. We provide comprehensive real estate lending and financing needs for Oregonians state-wide. If you’re considering using a reverse mortgage to supplement your income, send us a message, or call 541-275-1148, to talk with an experienced Oregon mortgage advisor today.