There is a lot of confusion about reverse mortgages. You need to be educated on the program so that you can make the best decision for your personal situation.
Basically, this is a loan that will allow you to use your home equity to have a monthly income coming in, or a large lump sum at once, or a credit line. You can get any combination of these things as well. If you have an existing loan, it must be paid off using the proceeds, so you will eliminate your monthly mortgage obligation. Although the government does not lend you the money, your reverse mortgage is guaranteed by the Federal Housing Administration (FHA), and you may remain living in the home. The debt that you or your estate owes can never be more than the value of your home.
Here are four commonly repeated myths, along with the facts, to help you further understand reverse mortgages: