Reverse Mortgage vs. Home Equity Loan

Seniors over 62 who qualify for a Reverse Mortgage find that a Reverse Mortgage is good alternative to their other options: 1. Moving to a lower priced home 2. Seeking property tax credit or abatement or 3. Obtaining a Home Equity Loan. 

Reverse Mortgage vs. Home Equity Loan

One benefit of applying for a Reverse Mortgage is that there are no income requirements, it pays you and you no longer have a mortgage payment.  In order to qualify for a Home Equity loan, you would need sufficient debt to income ratio and you will still be responsible for your monthly mortgage payments.  With the Home Equity loan, seniors are still at risk for high home equity rates.

To qualify for a HUD Reverse Mortgage, you need to be 62 years old, own your home outright or have a low mortgage balance and you must continue to live in the home.

If you are a senior shopping for a Reverse Mortgage, I would suggest going to the Federal Trade Commission website, http://www.ftc.gov/bcp/edu/pubs/consumer/homes/rea13.shtm  the FTC has worksheets online that can help you compare mortgages and lenders.

If you are a senior and you meet the requirements, you can call 1-800-569-4287 to get a list of FHA Approved Lenders from the FTC.

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