Reverse mortgages 101

June 9, 2:10 PMBusiness and Finance 101 ExaminerAndy Samuels

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Reverse mortgages 101 articles

• Reverse mortgages 101: single-purpose reverse mortgages
• Reverse mortgages 101: federally-insured reverse mortgages
• Reverse mortgages 101: propietary reverse mortgages 

 

 

 

A reverse mortgage is exactly what its name suggests - a mortgage in reverse. Instead of you paying money to a lender in exchange for the money they paid up front for your home, a lender pays you money in exchange for the money in your home that will become available upon your death, or when you sell the home.

Reverse mortgages are available to anyone 62 years of age or older. There are three types of reverse mortgages according to the Federal Trade Commission.

Single-purpose reverse mortgages
These are offered by some state and local government agencies and nonprofit organizations. (for more info click here)

Federally-insured reverse mortgages
These are known as Home Equity Conversion Mortgages (HECMs). They are backed by the U. S. Department of Housing and Urban Development. (for more info click here)

Proprietary reverse mortgages
These reverse mortgages are not connected to the government. In fact, they are private loans that are supported solely by the companies that develop them. (for more info click here)