What Is A Reverse Mortgage
You might not think this would be a popular program in Fort Lauderdale and South Florida due to the large declines in property values but there are still plenty of people with equity and who own their homes free and clear.
Let’s define what a reverse mortgage is by using the definition from Wikipedia:
A reverse mortgage is a form of equity release (or lifetime mortgage) available in the United States. It is a loan available to seniors aged 62 or older, under a Federal program administered by HUD. It enables eligible homeowners to access a portion of their equity. The homeowners can draw the mortgage principal in a lump sum, by receiving monthly payments over a specified term or over their (joint) lifetimes, as a revolving line of credit, or some combination thereof. The homeowners’ obligation to repay the loan is deferred until owner (or survivor of two) dies, the home is sold, they cease to live in the property, or they breach the provisions of the mortgage (such as failure to maintain the property in good repair, pay property taxes, and keep the property insured against fire, etc). The owner can be out of the home for up to 364 consecutive days (i.e., into aged care).