reverse mortgage basics
What Is a Reverse Mortgage?
A reverse mortgage is a special home loan that makes it possible to gain extra income while you remain living in your home. How does it work?
- You use your home as collateral on a loan you must repay in monthly installments.
- You convert a portion of the equity you’ve built up in your home into cash.
- You turn a portion of your home into a rental unit that provides you with ongoing revenue.
“B” is correct. The cash you get from the reverse mortgage can be paid to you in several ways: You may receive it as a regular monthly cash advance or as a credit line you can draw on periodically when you need additional income. You may even receive the cash as a lump sum or combine and make use of all of these payment methods.