Like almost anything in life, reverse mortgages can be great if utilized correctly and can result in financial chaos if used incorrectly.
Reverse mortgages are marketed to older Americans as a means for people to have some extra money so that they may live comfortably. Borrowers must be at least 62 years of age and must live in the home. With a reverse mortgage, the homeowner always retains title to their property. However, they may have little to show for it.
The negative to reverse mortgages is that while the borrower most of the time is not required to repay the loan provided they are living and stay in the home, upon death or moving from the home, the lender frequently becomes the virtual owner of the home.
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