There are a number reasons why a reverse mortgage can be a better choice than a normal home equity loan for homeowners 62 years or older. It is an individual decision, but some of the common reasons a reverse mortgage makes more sense are:
Never having to make a mortgage payment. Any payments are optional.
No income or assets are required to qualify for a reverse mortgage.
Your credit rating is irrelevant, you can be behind on your mortgage or tax payments.
A home equity loan can be closed or reduced by the bank at anytime; a Reverse Mortgage which cannot.
The available credit limit on a Reverse Mortgage automatically grows.
With a Reverse Mortgage repairs can be made through escrow in order to qualify.
We suggest that if the need for a home equity loan is going to be ongoing, that a reverse mortgage is a better solution, if the need is very short term, then a home equity line of credit may make sense, if the borrower qualifies.