Reverse mortgage is like a loan, the difference being that you get paid for handing over the rights of your house to a buyer after a pre-defined time period of 15 or 20 years. The popularity of reverse mortgage among senior citizens is mostly to do with their assets being tied to a rather illiquid form of investment—their homes. They can derive income by way of reverse mortgage, however, it has not taken off in India as yet. The reason being that for most Indians, the house is like a family asset, which they rarely feel comfortable selling, let alone putting it up for reverse mortgage. Moreover, the structure of the product in its current form is yet to catch the fancy of people.

OLMdesk@outlookindia.com