Finance
A NH property owner who is 62 or older may qualify for a reverse mortgage that provides:
AA loan that requires monthly principal and interest payments
BLoan proceeds based on home equity with no monthly payments required, with the loan repaid when the property is sold or the owner moves or dies✓ Correct
CA second mortgage at below-market rates
DFree mortgage insurance
Explanation
A Home Equity Conversion Mortgage (HECM, the most common reverse mortgage) allows homeowners 62 or older to access home equity as a lump sum, monthly payments, or line of credit. No monthly payments are required—the loan is repaid when the last borrower sells the home, moves out permanently, or dies.
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Key Terms to Know
Amortization
The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Math Concepts
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