Reverse Mortgage Basics

What is a Reverse Mortgage?

A Reverse Mortgage is a financial tool which enables senior homeowners to benefit from the equity they have in their homes, without selling and without making payments on a loan. This enables them to stay in their homes for as long as they wish without losing ownership and without any kind of risk.

To put it another way, a reverse mortgage is a loan secured by the equity in the senior citizen's primary residence, which never has to be paid back as long as:

• the borrower(s) maintain the home as their primary residence,
• the borrower pays the property taxes and hazard insurance, and
• the home is maintained to preserve its value.

This is possible largely because of these three factors:

• today's reverse mortgages were designed by HUD specifically for the benefit of senior citizens
• the interest rate charged on these loans is very low
• the loans are insured by FHA, which protects the borrowers and their heirs as well as the lenders

Have questions? Need help?

Knowledge is power. It is very important for you to be informed about reverse mortgages before deciding whether or not this financial tool would be a good choice for you. Please feel free to read through the information on this site, and then request a free, no obligation consultation. This will help you (and your family) to make an informed decision about whether a reverse mortgage makes sense for you, in your particular situation.