Who typically qualifies for a reverse mortgage?

A reverse mortgage is a financial product designed primarily for homeowners who are at least 62 years old. This age requirement is in place to ensure that the borrower is likely to benefit from the equity in their home to provide income or cash flow during retirement. As homeowners age, they often have substantial equity built up in their property but may have limited income sources during their retirement years.

Under this program, eligible homeowners can access a portion of their equity without needing to sell their home or make monthly mortgage payments. Instead, the loan is repaid when the homeowner moves out of the home or passes away. This makes reverse mortgages a viable option for seniors looking to supplement their retirement income while continuing to live in their homes.

Other options do not meet the criteria set for reverse mortgages. For instance, while any homeowner may have the option to consider obtaining a standard mortgage or home equity loan, that does not apply to reverse mortgages specifically. First-time homebuyers do not qualify since the program is geared towards those who already own their homes and are in their retirement years. Also, while having an existing mortgage might affect the amount of equity available, it is not a requirement for securing a reverse mortgage; the essential criterion remains that homeowners must be aged 62 or older.