The reverse mortgage is a specialized type of loan which is used as collateral against home�s equity. The money from the bank is not borrowed in this case. Better yet, the money is given against the property of the equity. There are certain advantages and disadvantages of this loan. Consider both while purchasing reverse mortgage loans.reverse mortgage calculator
Advantages of the Reverse Mortgage
 Apparently, there are some advantages of the reverse mortgage loan. For elderly people, securing a loan is difficult especially low interest loans. The money is required for retirement and health care situations. Most lenders fail to pay heed to the elderly population citing unpaid loans as a fundamental reason. The elderly population does not always have a fixed source of income and they can pass away during the tenure of the loan.
 The reverse mortgage loan allows the senior population feels comfortable and so does the lenders as a firm source of collateral is available which lessens risk considerably.

Major disadvantages of reverse mortgage
There are number of disadvantages attached with using this reverse mortgage loan.
1: One disadvantage of reverse mortgage is that the house can be lost and if the payments aren�t regular, then lender can take over the house. So now, house can�t be used as collateral. The possibility exists that loan price can exceed the price of the house. The reverse mortgage has huge interest rates. For the last thirty years, compound interest can put the house at serious risk. Thus, the tenant has to pay more than house�s worth. Some money may be left payable if the house is sold.reverse mortgage loans
2: The loan doesn�t have to be repaid until and unless the tenant dies, sells the house or moves out. The loan has to be repaid after its tenure has finished. The house still firmly remains with the tenant. Thus, the taxes and insurance has to be paid up. Repairs and maintenance has to be done time and time again. These payments must be made or else the loan has to be paid back.
3: Lenders can seldom stipulate the maintenance demands on the tenants. This is a tough job for elderly people who don�t have the potential at all. They can noy maintain the house that well. Then, someone needs to be hired which means more cost.reverse mortgage cons
4: Another reverse mortgage disadvantage is that heirs can lose the housing property after tenant�s passes away. This is a concern for sole owners if they are not on the list of the will. The lender will take over the house for repayment of debt. Thus, the heirs end up with a stalemate.
5: Yet another disadvantage of reverse mortgage loan is that equity is based on many factors such as:
� Amount of equity owned
� Age of the individual
� The interest rate on the loan

 The cash payments are done in a variety of different methods such as credit lines, large payment and monthly payment.reverse mortgage disadvantages
 There are more disadvantages of reverse mortgage loans as compared to advantages. Thus, a tenant should investigate before purchasing reverse mortgage loan.

More info:
http://www.reverses-mortgage.com
By Sylvester Smith