What Is A Reverse Mortgage?

A reverse mortgage is a loan for home owners 62 and older to payoff their current loan and/or take money out of their home and never have to make a payment as long as they occupy the home. It must be owner occupied and homeowners must still pay their property taxes and home owners insurance. Proceeds are tax free.

You just need to be over 62, live in the home and have a decent equity position in your home. Once the borrower has either sold the home or permanently moved from the residence or passed away the loan would come due. They or their heirs would either have to sell the home and pay the lender (family keeps any additional equity if there is any) or they can refinance out of the reverse in order to keep the property.

This loan is good for any senior 62 and older that wants to access a portion of their home equity as tax free cash (lump sum, line of credit, monthly or tenure payment etc) all while never making another payment as long as they occupy the property.* It’s also great for seniors who were unable to meet the income or credit guidelines of a home equity line of credit or other loan as the reverse mortgage uses less stringent income and credit underwriting guidelines.

More and more, financial planners are recommending it as a tool to allow borrowers to use the reverse to get money rather than drawing down on their investment portfolio.


* There are some circumstances that will cause the loan to mature and the balance to become due and payable.  Borrower is still responsible for paying property taxes and insurance.  Credit is subject to age and property qualifications.  Program rates, fees, terms and conditions are not available in all states and subject to change.