How Do “reverse mortgages” work?
In: Economics
First, they can only be sold to the elderly.
Second, a company buys your house from you for an amount that’s based on their estimate of when you will die.
Third, Instead of giving you all of the money up front, they pay you an amount every month based on the purchase price. This gives you extra money to live on, while you get to keep a place to live.
Fourth: when you die, the mortgage company gets your house.
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