Reverse mortgages allow older homeowners to turn part of their home equity into tax-free cash, using a loan that doesn’t have to be paid back until they die, sell or move out.
That sounds good to a lot of seniors navigating financial fallout during the coronavirus pandemic. Stay-at-home orders may have taken away jobs needed to make ends meet, while low interest rates and a volatile stock market have endangered income from retirement savings.
A reverse mortgage could be exactly the right tool at the right time. Or it could be an expensive mistake. In my latest for the Associated Press, learn exactly how these loans work and alternatives to explore before you commit.