For retirees wanting a financial product that gives them access to their home equity while still living in their home, reverse mortgages have become the go-to choice. But, as with any financial product, there are both pros and cons. If you're a homeowner contemplating how a reverse mortgage might fit into your retirement plan, it's imperative to grasp the complexities behind these loans.

What is a Reverse Mortgage?

Reverse Mortgage: A loan for homeowners aged 62 and older that gives them cash to tap into some of the equity in their home. In a classic mortgage, the homeowner pays the lender each month; in a reverse mortgage, the lender pays the homeowner.