by 
The Curious Bag
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A reverse mortgage is a home-loan option available for senior homeowners. The reverse mortgage is generally repaid with the home equity that has built up when you sell your home, move out or pass away.
Types of Reverse Mortgages
There are three basic types of reverse mortgages available. These types are FHA-insured, lender-insured and uninsured reverse mortgages.
Reverse Mortgage Qualifications
To qualify for a reverse mortgage, the homeowner needs to be at least 62 years old. Your mortgage needs to be paid off or close to being paid off.
Reverse Mortgage Benefits
The reverse mortgage loan can be paid to you in a lump sum, in monthly payments, or a combination of both. You will no longer be responsible for a monthly mortgage payment, which is beneficial to anyone on a fixed income.
Reverse Mortgage Amounts
The amount of the reverse mortgage is determined by the home value, the homeowner's age, and the amount of the equity in the home.
Considerations
A reverse mortgage can also affect any public benefits you receive. If you receive Medicaid or Supplemental Social Security Income (SSI), you may need to consult your caseworker before applying for a reverse mortgage.
Warnings
A reverse mortgage is not a good option if you planned to pay off your home and leave it to your children or heirs.
Source:
National Consumer Law Center, "Tips for Consumers on Reverse Mortgages"
Consumers Union, "Reverse Mortgage Consumer Tip Sheet"
More Information:
The Wall Street Journal, "The Costs and Benefits Of a Reverse Mortgage "
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