How Does a Reverse Mortgage Loan Work?
A reverse mortgage loan can be treated much like a home equity line of credit where you simply take money out as needed; it can also be paid out to you in one lump sum or on an installment plan. You may also have several different types of reverse mortgages to choose from. These include the federally insured reverse mortgages and home equity conversion loans mentioned above as well proprietary reverse mortgages (obtained through private lenders) and single-purpose reverse mortgages (secured though government agencies or non-profit organizations). However, your choices can be limited by factors such as your income, age, primary residence, and the amount of equity you have built up.
