A Reverse mortgage is a type of mortgage loan that the FHA insures. It’s for senior homeowners that allow borrowers to access a portion of the home’s equity and uses the home as collateral. The loan generally does not have to be repaid until the last surviving homeowner permanently moves out of the property or passes away. At that time, the estate has approximately 6 months to repay the balance of the reverse mortgage or sell the home to pay off the balance. This loan is available only to homeowners aged 62 or older. The homeowners must continue to pay required property taxes, homeowners insurance, and maintain the home according to federal Housing Administration requirements. Failure to meet these requirements can trigger a loan default that may result in foreclosure.
