Watch CBSN Live

Reverse Mortgages: The Basics

Is a reverse mortgage right for me?

The answer depends on a number of variables, including whether you've exhausted other lending options. Just bear in mind that reverse mortgages can be an extremely expensive way to borrow.

A reverse mortgage is a loan, paid to you either in installments or a lump sum, for which you use your home as collateral. The loans are typically available only to people age 62 and up, and they generally don't have to be repaid until you die or sell your house.

A reverse mortgage may be the right choice if most of your wealth is tied up in your house — but they have major drawbacks. In particular, critics complain that high upfront fees can make these loans exorbitantly expensive. Alternatives to consider include home equity loans and lines of credit.

The following links can help you understand reverse mortgages and decide whether one makes sense for you.

Editor's Pick
View CBS News In