What is a reverse mortgage?
A Reverse Mortgage works by allowing homeowners aged 62 and older to borrow from their home's equity without having to make monthly mortgage payments. The borrower may choose to take funds in a lump sum, line of credit, or via structured monthly payments.
Many homeowners have found that a reverse mortgage is a great way for them to take advantage of the equity they have built up in their homes.
A reverse mortgage is different than a traditional mortgage. Instead of making monthly payments, the lenders pay you money through monthly installments, a line of credit or a one-time lump sum. The money that the homeowner receives is dependent on their age and the value of their home.
One of the great advantages of a reverse mortgage is that you are not required to pay back the loan until the home is no longer your primary residence. Another great feature is that the homeowner can never owe more than the value of their home.