Reverse mortgages as its name indicates operates in a manner opposite to that of the typical mortgage such as a home loan. In a typical mortgage, you borrow money in lump-sum right at the beginning and then pay it back over a period of time.

Reverse Mortgage

In your payback — the EMI — a portion goes towards paying the interest and the remaining goes towards paying back principal. All along, you pledge the asset — namely the home you have bought with the loan — to the bank. This asset is the security against which the bank is lending to you. In reverse mortgage, you pledge a property you already own (with no existing loan outstanding against it). The bank in turn gives you a series of cash-flows for a fixed tenure. These can be thought of as reverse EMIs.

NHA Housing Loan

There are various forms of reverse mortgage available in the developed countries. The specific format National Housing Board (the facilitator for housing finance in India) is promoting is one in which the tenure is 15 years and the owner of the house and his/her spouse continue to live in the house till their death — which can occur later than the tenure of the reverse mortgage. Should I Refinance Home

The IMPORTANT POINT is — how much of an annuity income can my house generate using reverse mortgage? The banks have so far not indicated which interest rates they will use to determine the EMI — however, we can safely assume that it will not exceed the interest rates used for loan against property — which is currently in the region of 12-14%.REVERSE MORTGAGE: Reverse mortgage as its na…

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1. Reverse Mortgages: Refinancing with These

2. Disadvantages of Reverse Mortgages

3. Federal Reverse Mortgages

4. Reverse Mortgage in simple terms

5. Are reverse mortgages different than home equity loans?