The Lowdown on Reverse Mortgages Rules and Restrictions

  • Borrower must be age 62 or older
  • No monthly payment is required
  • Must obtain co-op board approval in most cases
  • Proceeds can be used for any purpose
  • No financial reports, credit history or medical reports required
  • Loan can be disbursed in the form of a lump sum, line of credit or a monthly payment option
  • Loan must be paid back upon the death of the borrower, if the borrower moves out or sells the home
  • Loan amounts vary based on age of the borrower; interest rates and adjusted value of the property; and geographic location of the home.
  • Single borrowers and older applicants qualify for higher loan amounts
  • Remember that reverse mortgages are not for everyone
  • Certain mortgage restrictions are attached to government loans

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