What happens when you move, sell or die?

An exit plan belongs at the beginning

A reverse mortgage postpones repayment; it does not remove it. Common repayment events include a sale, moving out permanently, the death of the last borrower and default. A transfer of ownership can also matter. The exact definitions and deadlines come from the mortgage contract.

Do not assume every product gives an estate the same number of months or that a temporary absence is treated like a permanent move. Ask the broker and lawyer to identify the relevant clauses for the household's circumstances.

If one person stays in the home

Ask who is a borrower, who is on title and who is entitled to remain under the agreement. The position of a surviving spouse or another resident should be confirmed before signing, especially when that person is not a borrower. A general description online is not a substitute for that review.

Have the discussion around actual possibilities: one spouse enters care while the other stays, both leave for an extended period, or a relative moves in. Request a written explanation of what needs to be reported and when repayment would become due.

Selling and keeping the home are different routes

A sale may provide the money for repayment, but ask whether repayment from other funds or new financing is possible if the family wants to keep the property. An heir's wish to keep it does not itself fund the payout. Any replacement financing needs its own approval.

Before listing, obtain a payout statement and understand how interest changes the amount with time. Budget for real-estate, legal and other sale costs separately. If the transaction date changes, get an updated figure rather than treating an earlier estimate as final.

Give the executor a usable information trail

Create a simple folder with the mortgage agreement, latest statement, lender contact details, insurance information and the lawyer's contact. Tell the appropriate person where it is stored. That is more useful than leaving a family member to infer obligations from an advertisement years later.

Following a death, the executor should promptly ask the lender about notification requirements, deadlines, documents and any available extension process. Estate administration can take longer than the mortgage's repayment window. Keep the property insured, maintained and secure while professional advice is obtained.

Ask about protection without assuming an inheritance

Some products include a no-negative-equity commitment, subject to their conditions. That protection is not a promise of a particular inheritance or that every sale expense is covered. Ask the lawyer to explain what value is used, which obligations must have been met and how the promise applies on repayment.

• What event starts the repayment clock?
• What happens if one borrower remains at home?
• What notice is required for a move into care?
• Can the estate repay without selling, and by when?
• How are early repayment charges treated after death or a move?