There are several ways one can receive tax-free money through a reverse mortgage. One is a perpetuity (tenure) payment. The borrower(s) receives a fixed amount every month, for their entire lives (as long as at least one borrower lives in the home) - even if the proceeds exceed the value of the home. Remember - a reverse mortgage is a non-recourse loan , which means neither the borrower nor the heirs are responsible for paying back any shortages should the loan amount be greater than the value of the property.