WTH is a reverse mortgage?

A reverse mortgage is like an interest-only mortgage where the interest expense is added to the loan balance instead of the homeowner making monthly interest payments.

A reverse mortgage is a loan for senior homeowners that allows borrowers to access a portion of the home’s equity and uses the home as collateral. The loan generally does not have to be repaid until the last borrower no longer occupies the home as their primary residence. 1 At that time, the estate has approximately 6 months to repay the balance of the reverse mortgage or sell the home to.

Barclays analyst sees housing rebound coming in 2012 Barclays Capital analyst Stephen Kim predicts a housing recovery buoyed by improving jobs numbers and the fact prices for nondistressed homes will have stabilized without government support. "In the absence of a government homebuyer incentives, prices for non-distressed home sales have stabilized for almost a year," Kim said.

Borrowers usually get only one reverse mortgage in their lifetime, so the loan is not familiar to the average consumer. To make matters worse, negative press about reverse mortgages still come up with a Google search. Thus, it’s not surprising that some people think reverse mortgages are a scam.

A reverse mortgage is a loan for senior homeowners that allows borrowers to access a portion of the home’s equity and uses the home as collateral. The loan generally does not have to be repaid until the last borrower no longer occupies the home as their primary residence. 1 At that time, the estate has approximately 6 months to repay the balance of the reverse mortgage or sell the home to.

 · The fixed rate HECM reverse mortgage is primarily for seniors who plan to use all or most of their borrowing power right away. Their intent is to pay off an existing mortgage, buy a house, purchase a single-premium annuity, or transact for some other purpose that requires a large and immediate payment.