Retiring on a Reverse Plan Washington Post Online (06/09/01) Vol. 12, No. 23 p.1B; Howley, Kathleen M.
A reverse mortgage is an alternative retirement solution for
those without a retirement plan. Reverse mortgages allow individuals
age 62 and older to borrow against the equity in their homes. In most
cases, payment is not due until the borrowers' death, at which point the
heirs assume financial responsibility for the house and can pay off the
principal and interest by selling the home. Rates for reverse mortgages
are usually on par with other adjustable rate mortgages. Some people
use the loan as supplemental income for personal needs such as financing
prescription drugs not covered by their insurance, or making
improvements to the home.