Whats the difference between a bank home equity loan and a reverse mortgage?
With a traditional home equity line of credit or a second mortgage, you must have enough income versus debt ratio to be eligible for the loan, and you have to make mortgage payments every month. The reverse mortgage is different in that it pays you, and is offered despite of your current income. The quantity you can borrow depends on the current interest rate, your age, and the appraised value of your home or FHA’s mortgage limits for your region, whichever is less. Usually, the more valuable your home is the lower the interest, the older you are, the more you can borrow. You don’t make payments, because the loan is not due as long as the property is your primary residence. You still have to pay your real estate taxes and other conventional payments like utilities like all homeowners, but with an FHA-insured HUD Reverse Mortgage, you can not be foreclosed or forced to leave your house because you “missed your mortgage payment.” Can the lender take my property away if I outlive the loan
