Exchanging equity for income: the reverse mortgage.(REAL ESTATE)

A reverse mortgage is a special type of loan used by older Americans to convert the equity in their homes into cash. The reverse mortgage is aptly named because the payment stream is reversed. Instead of the borrower making monthly payments to a lender as with a regular first mortgage or home equity loan, a lender makes payments to the borrower. Just as with a regular mortgage, ownership of the home remains with the borrower.

The money from a reverse mortgage can be used for ANYTHING from daily living expenses, home repairs and home improvements, medical bills and prescription drugs, to pay-off existing debts, education, travel, long-term health care, prevention of foreclosure, and other needs. In fact, proceeds from a reverse mortgage may be used to pay off an …