Cash In Your Home’s Equity Today
- Reverse mortgages allow older homeowners to access their home equity without having to sell their homes or take on monthly bills.
- A reverse mortgage is a type of loan in which the lender pays you and expects repayment when you die, sell your home, or no longer live there as your principal residence.
- To qualify for most reverse mortgages, you must be at least 62 and live in your home. The proceeds of a reverse mortgage (without other features, like an annuity) are generally tax-free, and many reverse mortgages have no income restrictions.
The Three Types of Reverse Mortgages
- The three basic types of reverse mortgage are:
Single-Purpose Reverse Mortgages: which are offered by some state and local government agencies and nonprofit organizations;
Federally-Insured Reverse Mortgages: which are known as Home Equity Conversion Mortgages (HECMs), and are backed by the U. S. Department of Housing and Urban Development (HUD);
Proprietary Reverse Mortgages: which are private loans that are backed by the companies that develop them.
- A single-purpose reverse mortgage is a unique option for homeowners. They generally have a low cost, are not available everywhere and can only be used for one purpose. In most cases, you can qualify for these loans only if your income is low or moderate.