There are mortgage loans, and there are reverse mortgage loans. If you think the latter is one in which you finance the lender’s home, instead of the other way around, you’d be wrong! The reverse loan is one in which a finance company buys the equity in a home. While the homeowner is alive, the company will make monthly payments to the owner. The homeowner may alternatively opt to receive a lump sum payment. After the homeowner passes, moves, or sells the house, the loan becomes due. The home does not have to be paid off to get a reverse mortgage loan, but it usually requires a good deal of equity.
These loans provide a way for senior citizens to take equity out of their home without selling the home. This has the benefit of allowing them to live a better life without the stress of financial obligations; at least regarding the mortgage. It
Many banks are trying to compete with the auto manufacturers by reducing their car loan rates as well; however, those rates are still higher than those of the carmakers. They are still good, but typically 1 to 2% higher, and in some cases as much as 6% higher.