What Are The Tax Implications Of A Reverse Mortgage
A reverse mortgage is a special kind of home loan that is designed to let homeowners who are at least 62 years old to access a part of their home’s equity. It’s referred to as a reverse mortgage because the lender pays the borrower, instead of the other way around. These payments could be a line of credit, a monthly advance, or a lump sum. It could even be a combination of both. Understanding Reverse Mortgages Reverse mortgages come in three types. The first one is the single purpose reverse mortgage which is offered by some local and state government agencies as well as non profit firms. The second one is the federally insured reverse mortgage, which is also referred to as Home Equity Conversion Mortgages or HECMs. This type of loan is backed by the US HUD or the United States Department of Housing and Urban Development . The third one is the proprietary reverse mortgage. They are also referred to as private loans that are backed by the firms that created them. If you take ou...