What is a Reverse Mortgage Loan

What is a Reverse Mortgage Loan?

By: Sydney Zabb


Reverse Mortgage Loan
Credit: Unsplash


Reverse mortgage is basically a loan that allows you to withdraw money from your home equity without having the obligation to put your house for sale. it is also called “Equity Release” but this Term is less common. You can borrow up to certain percentage of the value of your house (example 55% or up to 80% for some banks).

The maximum amount you’re able to borrow will depends on your  Age, House current value and Lender.


Reverse Mortgage Loan
Credit: Unsplash


How the mortgage is payed back?

You pay back your mortgage when you Leave your house, or sell it to someone else .

you don't have to pay any amount on a reverse mortgage until the loan is due. 

The longer is the Loan, the more interest you have to pay on your reverse mortgage.

The remaining Equity of your home is affected by the total value of the Loan.




Is there any cost or fees on reverse mortgage?

  Reverse mortgage Fees may include:

  • a home Evaluation fee
  • a setup fee or application fee
  • a high interest rate
  • a penalty if you pay off your Loan Before the Loan is due  (good to mention)
  • may also have legal fees 

Note that information above can vary depending on Lender and your Country of residence.






 Disclaimer: this article does not constitute a financial advice. It's only for information purpose.



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