A Reverse Mortgage enables older homeowners to convert a portion of the equity in their property into cash. It also provides a method for retirees to stretch their finances by using the accumulated equity in their home to cover their living expenses.
As long as the homeowner lives in the home, they are not required to make monthly mortgage payments. Instead, the lender makes monthly payments to you. The homeowner is not required to pay back the reverse loan until the home is sold, vacated, or the owner passes away.
However, the homeowner must remain up to date with their property taxes, hazard insurance, homeowner’s association dues, other applicable fees, and be able to maintain the property in good order.