After retirement, without regular income, you may sometimes struggle with finances. If you’re a homeowner, a reverse mortgage is one option that may help you manage your financial challenges.
What is a reverse mortgage?
A reverse mortgage is a home loan that allows homeowners 62 and older to withdraw some of their home equity and convert it into cash. You don’t have to pay taxes on the proceeds or make monthly mortgage payments.
How people use reverse mortgages
You can use reverse mortgage proceeds however you like. They’re often earmarked for expenses such as:
Helping children with college
Buying another home that might better meet your needs as you age
Advantages and disadvantages of reverse mortgages
Your heirs won’t have to repay the loan
The fees cost thousands of dollars
The loan gives you financial wiggle room
The loan reduces your equity in your home
An eligible surviving spouse can stay in the home
You could lose your home if you don’t pay property taxes and insurance
How do reverse…
This article was written by NerdWallet and originally published on www.nerdwallet.com