Single-Purpose Reverse Mortgage: A financial tool that lets senior homeowners retrieve some of the equity from their homes for a specific, lender-approved reason. Single-purpose reverse mortgages ...

Single-purpose reverse mortgages allow homeowners aged 62 or older to borrow against their home equity to fund a single, lender-approved purpose, such as paying property taxes or performing maintenance on the home. Typically, this is the least expensive type of reverse mortgage to take out, largely because it’s backed by government agencies and non-profit organizations.

Key Takeaways. A reverse mortgage is a type of loan for people age 62 or older that allows homeowners to convert some of their home equity into cash income. In a single-use reverse mortgage ...

A single-purpose reverse mortgage is a type of reverse mortgage loan where the lender specifies that the loan’s proceeds can be used for only one approved purpose (such as paying property taxes or making home improvements). This type of loan can be hard to find because single-purpose reverse mortgages are only offered by some state and local ...

A single-purpose reverse mortgage is an arrangement whereby lenders make payments to borrowers in exchange for some of the borrowers equity. Borrowers must use these payments for a specific purpose approved by the lender. These can be contrasted with proprietary reverse mortgages and home conversion mortgages .

A single-purpose reverse mortgage allows homeowners that are 62 years of age or older to tap into their property’s equity to pay for expenses that are lender-approved. Lender-approved expenses that are typically covered by a single-purpose reverse mortgage are property taxes, significant home repairs and renovations, and home insurance premiums.

Single-purpose reverse mortgages are far less common than HECMs. These mortgages are offered by state, local, and nonprofit agencies and tend to be the least expensive reverse mortgage option.

Reverse mortgages provide individuals ages 62 and older with income in the form of a loan using the equity in their homes. The three types of reverse mortgage loans are single-purpose, federally ...

Single-Purpose Reverse Mortgage. Single-purpose reverse mortgages are the least expensive reverse mortgages, since their proceeds can only be used for a single, agreed upon use. They are sometimes offered by state or local government agencies or nonprofit organizations. Money from a single reverse loans can be used to replace a roof, improve plumbing, pay taxes or cover some other expensive ...

Single-purpose reverse mortgages are overseen by governments and nonprofits, generally for economically disadvantaged seniors. How a Reverse Mortgage Works . A reverse mortgage is when a homeowner borrows against the equity in their home. Only available to adults over the age of 62, reverse mortgages are often used to provide liquid cash flow to offset living expenses, make home modifications ...

While HECMs represent most of the reverse mortgage market, a small segment includes two other loan products: proprietary reverse mortgages and single-purpose reverse mortgages. For some homeowners ...

Reverse mortgages are loans against the equity you’ve built in your home. They’re designed for seniors who need cash but don’t want to sell their homes. Because they deplete home equity, which is often the largest asset seniors have, reverse mortgages should be considered very carefully. Learn More About Home Loans . Compare current mortgage rates; Compare current mortgage refinance ...

Single-Purpose Reverse Mortgages . The least expensive of reverse mortgage types, single-purpose reverse mortgages are offered by organizations such as nonprofits, state agencies, and local governments. They are not federally insured. Most low- to moderate-income homeowners can qualify.

A reverse mortgage enables you to withdraw a portion of your home's equity to supplement your income, or to purchase a home. There are no monthly principal and interest payments. The only reverse mortgage insured by the US Federal Government is called a Home Equity Conversion Mortgage (HECM) and is only available through an FHA approved lender.

Single-purpose reverse mortgages are granted by local and state governments and nonprofit agencies, generally for homeowners with low to moderate incomes. These types of loans can be used only for ...

The governments or organizations offering single-purpose reverse mortgages set the requirements. Single-purpose loans come in two flavors: Deferred Payment Loan (DPL) You can use the DPL to pay for property repairs that are necessary to alleviate health and safety concerns. It usually carries a very low interest rate (sometimes even zero ...

Single-Purpose Reverse Mortgage. Single-Purpose Reverse Mortgages are government-regulated mortgages that are for — you guessed it — a single purpose. The purpose of the loan must be approved by the lender and used for that explicit purpose only. Because Single-Purpose Reverse Mortgages are so inflexible, they tend to be the least expensive ...

There are three kinds of reverse mortgages: HECM; single-purpose reverse mortgage; proprietary reverse mortgage. Of the three, the HECM is the only government-insured reverse mortgage and is the least risky because of various government protections for borrowers. We’ll discuss the protections later on in the article. The HECM is what’s known as a nonrecourse loan, which means that a ...