Pros

• Simple to qualify
• No monthly payments
• The homeowner can stay in the home permanently
• It pays off existing mortgages on the home
• The homeowner receives payments on flexible terms
• A reverse mortgage can not get “upside down” so the heirs will never owe more than the home is worth
• The estate inherit the home and keep the remaining equity
• Interest rate is lower than the traditional mortgages and home equity loans
• Proceeds are not taxable

Cons

• The fees are same as traditional FHA mortgage but can be higher than a conventional mortgage because of the high insurance costs
• Medicaid and other needs based government assistance can be affected
• The program is not well understood by most people