My Grandma took out a reverse mortgage on her home 4 years ago and it was nice for her getting that money each month from the reverse mortgage.
It's basically the bank making monthly mortgage payments to you for the loaned amount and the house is used as collateral for the reverse mortgage loan.
When you take out a reverse mortgage you don't get the full amount of money for the loan but instead you get the loan paid to you through monthly payments.
You then owe that money back to the bank however you can stay in your home until either you die or move out.
If you move out you either have to pay back the reverse mortgage loan or you lose the home to the bank.
That's what happened to my Grandmas house when she took out a reverse mortgage but when it came time for her to move out of the home and into a nursing home she was unable to pay back the reverse mortgage loan and the bank then took the home from her.
Basically the bank got the home for a lot less than what she paid for the home through the mortgage.
She paid $200,000.00 for the home through a mortgage and had it paid off but when she took out a reverse mortgage loan she only received $30,000.00 in payments through the loan and the bank got the home basically for the $30,000.00 they paid to my Grandma.
It's better to keep your home that's paid off and then sell it for the full price or even sometimes more in the future should you plan to move etc.
The only people that benefit from a reverse mortgage are the banks.