A reverse mortgage or reverse equity mortgage is a home loan that does not require to be paid back as long as the borrower occupies the property.

It provides a way of converting the home equity into cash, and does not require monthly payments as in other mortgages. Reverse mortgages are meant for senior consumers aged 62 or above.

H ome equity, which otherwise lies dormant can be converted into cash, and does this way of raising money does not require monthly payments as in other mortgages. Reverse mortgages are more suitable for senior consumers aged 62 or above.

A reverse mortgage can provide cash in a number of ways.

Features of Reverse Mortgages:

A reverse mortgage is just the opposite of a forward mortgage which requires the payment of the principal loan amount along with interest on a monthly basis. This helps a borrower in retaining his home equity and hence increasing the home value. But with reverse mortgages, there are no such monthly payments and so the debts go on increasing. The home equity therefore reduces to an extremely low value unless the property value keeps increasing. Therefore reverse mortgages are often known as "rising debt and falling equity".