Considering a Reverse Mortgage? Here’s What You Must Think About First

December 10, 2025

Considering a Reverse Mortgage? Here’s What You Must Think About First

A reverse mortgage can feel like a simple solution — access cash, stay in your home, no repayments. But it’s also one of the biggest long-term financial decisions many people make later in life.

That’s why understanding the key considerations before you sign anything is critical. The right decision can improve comfort and peace of mind. The wrong one can limit options later.

How Long Do You Really Plan to Stay in the Home?

Reverse mortgages work best when the plan is to stay put long-term.

If there’s even a chance you’ll downsize, move closer to family, or enter aged care in the coming years, this needs to be part of the conversation.

This one question alone can change whether a reverse mortgage makes sense.

How Much Equity Are You Willing to Trade for Comfort Today?

Accessing equity now means giving up some flexibility later.

You don’t have to borrow the maximum — and in many cases, you shouldn’t. The decision isn’t about what’s available, it’s about what’s appropriate.

Understanding this balance is where most people need guidance.

Do You Fully Understand How Interest Compounds?

Reverse mortgage interest compounds over time — meaning the loan balance grows faster the longer it runs.

Seeing long-term projections is essential. Without them, it’s almost impossible to make an informed decision.

If you haven’t seen a 5-, 10-, and 15-year projection, you’re not ready to decide yet.

What Exactly Will the Funds Be Used For?

Reverse mortgages work best when there’s a clear purpose.

They’re most effective when used to:

Support retirement income
Cover medical or care-related costs
Fund essential home modifications

If the purpose isn’t clear, the risk increases.

Are You Prepared for the Ongoing Responsibilities?

Even with a reverse mortgage, you remain responsible for:

Rates
Insurance
Property maintenance

If these costs become difficult later, it can create problems with the loan.

This is often overlooked — and it matters.

Have You Considered the Impact on Family and Estate Planning?

Reverse mortgages can reduce the equity left in the property.

Open conversations with family now can prevent misunderstandings later.

This decision affects more than just you.

Do You Know All the Fees and Exit Conditions?

Not all reverse mortgages are created equal.

Establishment fees, ongoing fees, interest rates, and exit conditions vary — and small differences can have a big long-term impact.

This is where independent guidance can save you thousands.

Have You Compared All Your Options?

A reverse mortgage should rarely be the only option considered.

Downsizing, refinancing, government support, or family arrangements may provide similar benefits with fewer long-term trade-offs.

The best choice is the one you make with full clarity.

This Is Not a Decision to Make Alone

Reverse mortgages can be useful — but only when they’re chosen for the right reasons, with the right structure, and full understanding of the long-term impact.

A short, obligation-free conversation can help you: