What is a Reverse Mortgage?
With a reverse mortgage, seniors age 62 or older can convert the equity in their homes into a tax-free income without having to sell the home. With a reverse mortgage, you won’t have to give up title or take on any new monthly mortgage payments. A reverse mortgage is just that… “reversed” in that instead of making payments on a mortgage, the lender makes payments to you.
This is a relatively new product and one that although starting to get more attention is still relatively unknown. To protect seniors, the Federal Housing Administration (FHA) mandates counseling prior to being able to be approved for a reverse mortgage. This counseling is done by a 3rd party so that the counsel is unbiased.
As to the special requirements to get approved for a reverse mortgage, seniors must be 62 or older and must have equity in their home. There are no special income or medical requirements.