It is a loan designed for people over 65 years of age
The objective is to obtain extra income for your retirement
The reverse mortgage is the solution that many people over 65 need to supplement the money they receive from their pensions. In Spain it is a very little known credit, but outside our borders, it is increasingly used. And in the midst of an economic crisis, banks take advantage of it to open a new line of business that can be profitable in the long term.
In summary, the reverse mortgage is a regulated financial product designed exclusively for elderly or severely dependent people. The objective is that they obtain liquidity with their home, but keep it as property until the moment they die. That is, instead of receiving the money afterwards, as would happen with a sale, it is obtained before that day.
How much money do you get with the reverse mortgage?
It depends a lot on the age, but banks are only delivering between 25 and 50% of the appraised valueso it is only suitable for people with high-value homes that bring you a lot of money despite this undervaluation.
The interests of these reverse mortgages are higher than those of traditional mortgagesbut it is not required to have a minimum income and the only guarantee required is to be the owner of the home that is delivered.