What Is A Reverse Mortgage?

I just like to address this question about reverse mortgages again.

A reverse mortgage is a mortgage that is geared to the elderly homeowners out there. This type of mortgage will allow them to use some or all of the equity that they have built up into their home over the years. Those that need funds to pay for medical bills, for long term care or to make improvements on their home can usually use the equity in their home to make these improvements. These loans are somewhat different than the conventional mortgage though.

To qualify for the reverse mortgage, you need to be at least 62 years of age. There are no credit or employment verifications. Some homes, such as those that are mobile homes, do not necessarily qualify for this type of loan because they may not be worth as much. The mortgage is taken out on the equity of the home. Equity is a term that describes the value of the home minus any mortgages or liens that are being held against it. The equity of a home goes up as the mortgage of the home is paid down. When the home is completely paid off, the equity of the home is the same as the home’s value on the market.