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Loan Products |
>> Reverse Mortgages |
A Reverse Mortgage is a special type of home equity loan that allows seniors to convert some of the equity in their homes into cash while still retaining home ownership.
 Reverse mortgages work much like traditional mortgages with one important exception: instead of you making a mortgage payment each month, the lender pays you.
Unlike conventional home equity loans, most reverse mortgages do not require any repayment of principal, interest, or servicing fees for as long as you live in your home. Funds obtained from these loans may be used for any purpose, including meeting housing expenses such as taxes, insurance, fuel, and maintenance costs.
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What's the Difference between a Bank Equity Loan and a Reverse Mortgage?
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With a traditional second mortgage, or a home equity line of credit, you must have sufficient income to qualify for the loan, and you are required to make monthly mortgage payments.
A reverse mortgage works very differently. The reverse mortgage pays you, and it is available regardless of your current income. You don't make payments, because the loan is not due as long as the house is your principal residence.
Of course you still are required to pay your real estate taxes and other payments like utilities, but with an FHA-insured HUD Reverse Mortgage, you cannot be foreclosed on or forced to vacate your house because you "missed your mortgage payment."
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