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Many physician homeowners have been roped into watching a commercial for a company selling reverse mortgages, usually presented by a stalwart actor that we like and trust. Whether a reverse mortgage is right for you or not, it’s a good idea to understand exactly what it offers and what it plans to take in return.

Although the name reverse mortgage may imply some type of payout, it is important to remember that it is basically a loan. According to the Federal Trade Commission (FTC), a reverse mortgage is a loan available to older adults that is basically an advance against your home equity. You convert your home equity into monthly payments, which are usually tax-free, and you are able to retain the title of your home so long as you live and so long as you stay within that home. When you pass away or if you decide to sell your home, the loan will need to be repaid—usually through the selling of the home. This, of course, lessens any inheritance that you could pass on to your heirs. The FTC cautions that these transactions can be complicated and require a great deal of review to ensure that it is a good fit for you.