What is a Reverse Mortgage exactly?

A Reverse Mortgage is a unique type of loan that allows seniors to get cash out against their homes equity. Unlike second mortgages or home equity loans, no payment is required until after the borrower moves out, sells the home, or passes away.

How do I qualify for a Reverse Mortgage?

To be eligible for a reverse mortgage you must be a homeowner no younger than 62 years of age. Your mortgage must either be paid off in full or have a low remaining balance. Before moving forward with a Reverse Mortgage you are required to receive more information from a HUD-approved counseling service. You can contact the Housing Counseling Clearinghouse at 1-800-569-4287 to receive a list of HUD-approved counseling services as well as a list of FHA approved reverse mortgage lenders in your area.

How is a Reverse Mortgage different than a home equity loan?

With traditional home equity loans you are required to make monthly mortgage payments once you receive the loan. Reverse Mortgages don’t need to be repaid until the borrower passes away or permanently moves from the residence. A home equity loan balance will decrease over time and a Reverse Mortgage balance will increase over time.


read more | digg story