Reverse Mortgages

Eligibility:

Typically, individuals aged 62 or older who own their homes outright or have a substantial amount of home equity are eligible. The home must be the primary residence.

Benefits:

1. Financial Flexibility: Homeowners receive funds, either as a lump sum, fixed monthly payments, or a line of credit, providing financial flexibility.

2. No Monthly Payments: Unlike traditional mortgages, reverse mortgage borrowers do not make monthly repayments. Repayment occurs when the homeowner sells the home or passes away.

3. Stay in Your Home: Borrowers can stay in their homes as long as they fulfill their responsibilities, such as maintaining the property and paying property taxes.

Pros:

1. Supplement Retirement Income: A reverse mortgage can serve as a source of additional income during retirement.

2. Homeownership Retention: Allows seniors to stay in their homes and retain homeownership without the burden of monthly mortgage payments.

Cons:

1. Accrued Interest: Interest accrues over the life of the loan, potentially reducing the homeowner's equity.

2. Impact on Inheritance: The loan balance, including accrued interest and fees, must be repaid upon the homeowner's death, potentially affecting the inheritance left for heirs.