More and more seniors are choosing reverse mortgages, allowing them to have near-instant access to the equity of their home investment. A reverse mortgage relieves the borrower from making monthly mortgage payments. With a reverse mortgage the lender pays the borrower. Income and credit history are irrelevant. The mortgage is based on the equity built into the borrower’s investment in the home.

The amount borrowed must be repaid, plus interest, when when the borrower dies, sell the home or moves out. If the home is worth less than the loan amount, the Federal Housing Administration makes up the difference. That’s the reason why mortgage insurance is required.

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