Jones; Q Whats the difference between a reverse mortgage and a bank home equity loan?
Answer Given to Mrs. Jones With a traditional second mortgage, or a home equity line of credit you must have sufficient income versus debt ratio to qualify for the loan, and you are required to make monthly mortgage payments. The reverse mortgage pays you, and is available regardless of your current income. It not a credit score based loan. The amount you can borrow depends on your age, the current interest rate, other loan fees, and the appraised value of your home or FHA’s mortgage limits for your area, whichever is less. Generally, the more valuable your home is, the older you are, the lower the interest, the more you can borrow. You don’t make payments, because the loan is not due as long as the house is your principal residence.
