How does a reverse mortgage differ to a HELOC?

[Haku]

I don't need to know this for any particular reasons. Just reading in general, trying to understand the whole concept behind reverse mortgages. However, it almost seems like a HELOC to me. So, I was just wondering if anyone knows that the difference is?

[jmjj215]

Re: How does a reverse mortgage differ to a HELOC?

It's kind of like you selling your house to the "lender" who pays you monthly intallments until all of a sudden you again have a normal mortgage. It is a really, really, really bad idea. Elderly are suckers for this b/c they want the extra income.

[Haku]

Re: How does a reverse mortgage differ to a HELOC?

Ah, that helps some. Thank you. And yeah, my knee-jerk reaction was that it was a bad idea, but I wasn't sure.

[Ima saver]

Re: How does a reverse mortgage differ to a HELOC?

I have read in Money, that for some elderly, it is the only way they can get by, have enough money to live on, and still remain in their homes. It is for people that don't really have any heirs to leave anything to. If that should happen to me, I have no heirs, and I might consider it. I will not be able to live on $400 a month in social security a month. (and I don't like cat food!!)