The HUD (U.S Department of Housing and Urban Development) offers HECM (Home Equity Conversion Mortgage). This loan can be used for any purpose. Other state governments offer low-cost reverse mortgage loans that can be used for a specific purpose only, for instance, to repair the home or pay property tax. Some of these loan programs are available only to homeowners with low to moderate income. More expensive type of reverse mortgage loans is available from the companies who develop these programs.
The true total cost of a reverse home mortgage loan is difficult to compare because the loan costs vary greatly. The reverse mortgage lenders must disclose the Total Annual Loan Cost (TALC), under the federal Truth-in-Lending law. The TALC is just one way of calculating the costs.
