A reverse mortgage is a home loan, used for any purpose, where seniors 62 and older can access the equity (cash) built up in their home. It can also be used to purchase a home should you desire to be free of having to make a monthly mortgage payment.

It is called a reverse mortgage because although you borrow money from a lender, the lender makes monthly payments to you, rather than you making monthly payments to the lender. Or they provide you with a lump sum either in cash at closing or accessed when you want it through a credit line. Funds can be used to pay off existing debt or as you see fit. Any cash back you receive is tax-free, and all interest is paid at the end of the loan, rather than the beginning.