A Reverse Mortgage is available to homeowners 62 years of age and older who wish to purchase or refinance a home. With this type of loan program, the borrower will not have a monthly mortgage payment. In addition, the borrower may get a cash advance or a monthly disbursement taken from the available equity in their home. Reverse Mortgages are often used as a retirement tool.
With a Reverse Mortgage, the borrower’s outstanding principle owed will increase each year. Upon the sale of the property or death of owner, the equity in the home may reach its limit. However, the borrower will not be held liable for owing any more on the house than its current market value.