{"id":369300,"date":"2016-04-04T10:47:20","date_gmt":"2016-04-04T15:47:20","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/realestate\/mortgages-equity-loans\/a-reverse-mortgage-guide.html"},"modified":"2024-07-01T09:48:02","modified_gmt":"2024-07-01T14:48:02","slug":"a-reverse-mortgage-guide","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/realestate\/mortgages-equity-loans\/a-reverse-mortgage-guide.html","title":{"rendered":"A Reverse Mortgage Guide for Older Adult Homeowners"},"content":{"rendered":"\n
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A Reverse Mortgage Guide for Older Adult Homeowners<\/h1>\n
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\n By Robert Rafii, Esq.<\/a> | Legally reviewed by Robert Rafii, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

A reverse mortgage can enhance an aging adult’s life going forward. For older homeowners with shrinking savings, reverse mortgages offer a low-risk source of extra income. To some, they are retirement tools to help ease the pressure from ongoing life expenses. This reverse mortgage guide will explain:<\/p>\r\n

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  1. How reverse mortgages work<\/li>\r\n
  2. If you’re a good candidate for a reverse mortgage<\/li>\r\n
  3. The benefits and risks involved<\/li>\r\n<\/ol>\r\n

    As you get older, your income level usually tapers off. Your income and savings may not be enough to cover your bills. The added costs of paying for needed home improvements or medical issues your insurance won’t cover can be devastating.<\/p>\r\n

    A reverse mortgage can address these issues as a retirement investment. Perhaps you want to live a bit more comfortably later in retirement. If you own a substantial amount of equity in your home, a reverse mortgage may be an option for you to turn the equity into cash.<\/p>\r\n

    What Is a Reverse Mortgage?<\/b><\/h2>\r\n

    A reverse mortgage loan is a home loan that allows homeowners to convert part of the equity in the home into cash. You get money based on your loan balance or equity. But, a reverse mortgage differs from a home equity line of credit (HELOC)<\/a>. Unlike other home equity loans, traditional mortgages, or second mortgages, you don’t pay back the loan amount until you sell the home. The lender can give the loan proceeds to you in a single lump sum payment or as a series of monthly payments throughout your lifetime.<\/p>\r\n

    A loan servicer’s only requirements for most reverse mortgages are:<\/p>\r\n