| Reverse Mortgage : The reverse mortgage is named so because the payment stream is “reversed.” Instead of making monthly payments to a lender, as with a regular mortgage, a lender makes payments to you.
 Reverse Mortgage
The reverse mortgage is named so because the payment stream is “reversed.” Instead of making monthly payments to a lender, as with a regular mortgage, a lender makes payments to you.
The funds received from reverse mortgage can be used for anything like daily living expenses; health care expenses, pay-off the debts and other needs.
To qualify there are no income or medical requirements. Even if you owe money on a first or second mortgage then you may still be eligible for a reverse mortgage.
Before applying for a reverse mortgage, you must first meet with a counselor. The counselor will educate you about reverse mortgages, to assist you in determining which particular reverse mortgage product best fits your needs and to inform you of other alternative options.
You can have your own choice as how to receive the money from a reverse mortgage. There are many options. The most popular option is the line of credit, which allows you to draw on the loan proceeds at any time. The funds from a reverse mortgage are tax-free; it's your money, not additional income.
Reverse mortgage does not affect regular Social Security or Medicare benefits. There are several factors on which the amount of money you get from a reverse mortgage depends on your age, type of reverse mortgage selected, appraised home value, current interest rates. The older you are and the more valuable your home, the more money you get.
When paying back your loan, no monthly payments are due on a reverse mortgage while it is outstanding. The loan is repaid when you stop to occupy your home as a principal residence, whether you pass away, sell the home, or permanently move out. The amount owed can never exceed the value of your home. The excess money goes to you or your estate if the home is sold.
Mainly there are two primary types of reverse mortgages:
A reverse mortgage insured by the Federal Housing Administration
The "Home Keeper" reverse mortgage
In addition to these products, a few private companies have created their own proprietary reverse mortgage products.
Fannie Mae, the nation's largest purchaser of home loans, purchases Home Keeper mortgages originated by participating private lenders.
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