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A lot of people aged 62 and older are living on limited fixed income, at the same time their mortgages are paid off. Reverse Mortgages are very useful for people who want to live in their home and get some extra money to live on.
You can get money once, every month or as a line of credit and you can use the money as you wish.

Important points about reverse mortgages:

Reverse mortgage is a loan. While you live in your house – the lender pays you. How much money you will get depends on your age, the equity in your home and the interest rate the lender is charging. You are still paying property taxes and upkeep on your home and you of course retain title to your home.

You can live in your home so long as you wish. Repayment of the loan is due if you move or sell your home or if you die or reach the end of the predetermined loan period – all it depends on your reverse mortgage. Usually if you die your heirs must pay off the loan (by selling or refinancing the home), in this case the lender does not take title to your home.

Your home cost will always cover what you owe. The value of your home at the time the loan is repaid limits the legal obligation to repay the loan. You are not liable for more than the value of the home.

Reverse mortgages use up the validity in your home. Over time the loan amount goes up. Each month interest is added to the principal loan balance because it is not paid on a current basis. You will have fewer assets to leave your heirs.

The federal Truth in Lending Act regulates Reverse Mortgages. This makes lenders to disclose the costs and terms of reverse mortgages. The Annual Percentage Rate (APR) and payment terms are included. If you choose a credit line as your loan advance you should know about charges related to opening and using your credit account.

Types of reverse mortgages: FHA-insured, lender-insured, and uninsured. All these types have different features and costs. Consult to your family, financial advisor or attorney to decide which is best for you.

Reverse Mortgage can really help you during your retirement years.