Reverse mortgages used to be a way for homeowners to get extra cash during retirement. Now they're also being used for a more-pressing purpose: helping people who are struggling to meet payments on high-interest-rate loans to keep their homes.  The strategy calls for persuading lenders to take the cash generated by a reverse mortgage in lieu of foreclosing on older homeowners.

With a reverse mortgage, the bank makes payments to the homeowner instead of the homeowner making payments to a bank. The loan is repaid, with interest, when the borrower sells the house, moves out permanently or dies. The products are complex and have high fees -- typically about 7% of the home's value -- and they make it difficult for homeowners to leave the property to their heirs. But they may be the best option for people who have built up equity in their home and would otherwise lose it.

In Washington, the National Council on Aging, an advocacy group, has launched a reverse-mortgage initiative to help older homeowners around the country learn how to use the product appropriately -- including ridding themselves of monthly mortgage payments.

An AARP study released earlier this month found that nearly one-third of 946 reverse-mortgage borrowers surveyed used the loans to pay off existing mortgage debt.

"For a small but crucial number of potential borrowers who are in financial distress, reverse mortgages can be essential in avoiding foreclosures -- sometimes on subprime or home-equity loans with very high interest rates," the AARP report says.