A reverse mortgage is a loan available to homeowners, 62 years or older, that allows them to turn part of the equity in their homes into cash.
A Reverse Mortgage was designed to help seniors with limited income use the accumulated equity in their homes to cover basic monthly living expenses, health care or other needs they may have.
The loan is called a reverse mortgage because instead of borrower making monthly mortgage payments to a lender, the lender makes payments to the borrower.
The senior is not required to pay back the loan until the home is sold or otherwise vacated. As long as the borrower lives in the home, he or she is not required to make any monthly payments towards the loan balance. The borrower must remain current on bills such as: property taxes, homeowners insurance, homeowners association dues (if applicable), etc.
Please keep in mind most loan eligibility requirements and guidelines do have exceptions and are reviewed on a case by case basis.