| Government-insured loans with capped variable interest
rates |
Private-sector products with uncapped and capped adjustable
interest rates |
| Other assets are safe from the lender’s reach in case the
lender lends more than the equity in the property |
Borrower has no such protection |
| Except for minimal credit checks for federal loan defaults, no income
or credit is needed to qualify and no monthly repayment is needed |
Must pass credit, income and monthly repayment-ability tests |
| The unused portions of the credit line grows larger every month |
Unused portions remain stagnant, subject to the cash-corroding impact
of inflation |
| No monthly payments to make |
Failure to make monthly payments can result in default and foreclosure |
| As part of a system of built-in protection for elders, free consumer
education from a HUD approved reverse mortgage counselor is required
before an application can become effective |
No such built-in safeguards for a vulnerable segment of the population |
| Total costs drop lower and lower after five years |
No such claim can be made |
