Traditionally, in order to get cash from a real estate property, one has to either sell the property, or has to take out a home equity loan -a loan that requires monthly repayment. Those two options may not be a problem unless you happen to be a retired person in need of cash.

Now reverse mortgage loans have opened up a third way of getting money from your real estate property. The good thing about a reverse mortgage is that you don't have to leave (sell) your home, or make regular payments to repay that reverse mortgage loan. Technically, a reverse mortgage is a loan against your home that you are not required to repay as long as you are living in that home. The money that you draw against your home (the amount of your reverse mortgage loan) can be paid to you in one lump-sum payment, or in several installments at the times and in amounts that you may specify. The reverse mortgage loan gets paid back to the lender -along with the interest -when you die, when you sell your home, or permanently move out of your home.

• Eligibility Requirements: All borrowers must be at least 62 years of age, and all owners of your home must be willing to apply for and sign/co-sign the reverse mortgage loan papers. It is also a requirement that owners must occupy the home (against which the reverse mortgage loan is being made) as their principal residence for the majority of the time during a given year.
  
• What kinds of Properties Are Eligible for Reverse Mortgage? Single family one-unit properties, Condominiums, Manufactured homes, and in some cases two to four unit owner-occupied properties are deemed eligible for reverse mortgage loans. Most reverse mortgage lenders would not lend money against mobile homes though.
  
• When Does a Reverse Mortgage Loan Become Due for Repayment? You do not have to make any repayment until: the last living borrower dies, sells the property, or permanently vacates that property. When any of these events occur, a reverse mortgage loan must be repaid in full, along with interest, and all other applicable fees.
  
• Why Does a Reverse Mortgage Loan Grow Over Time? Considering that you make no monthly payments (unlike traditional mortgage loans that have to be repaid in regular monthly installments), the interest gets compounded over time. As a result, the amount that you owe (your reverse mortgage debt) to the reverse mortgage lender grows bigger over time. As your reverse mortgage debt grows, your residual equity in your home goes down accordingly. The longer you live/occupy your home, the greater would be your reverse mortgage debt. The law requires, however, that the total amount payable to your reverse mortgage lender can never be more than the actual value of your home at the time of repayment of your reverse mortgage loan.
  
• Who Pays Property Taxes, and Insurance? You, the borrower, continue to own and occupy your property. Your are, therefore, responsible for all your property taxes, insurance costs, and repairs.
  
• What If I Don't Pay For Property Taxes, Insurance or Any Repairs? You will be considered at fault, and your lender will consider your loan to become due, payable in full, and may demand full and immediate repayment of your reverse mortgage loan from you.

Reverse mortgage loans provide a great way to get money out of your home during your retirement years. You may want to consult with your financial planner, and a reverse mortgage loan specialist for more information. You may also want to look into applicable taxation issues, and any impact your reverse mortgage loan may have on your eligibility for receiving assistance under any Federal and/or State programs. A reverse mortgage loan also affects your estate. It is highly advisable, therefore, to consult with a reverse mortgage loan specialist, a tax law expert, and your financial/estate planner.