There are various kinds of reverse home loans, and each one fits a different financial requirement - how to reverse mortgages work if your house burns. The most popular kind of reverse home mortgage, these federally-insured home mortgages normally have greater upfront expenses, however the funds can be used for any function. Although extensively available, HECMs are only offered by Federal Housing Administration (FHA)- authorized lending institutions, and before closing, all borrowers must get HUD-approved therapy.You can usually receive a bigger loan advance from this type of reverse home mortgage, especially if you have a higher-valued house. This home loan is not as common as the other two, and is normally provided by nonprofit organizations and state and local federal government agencies. Borrowers can just utilize the loan (which is generally for a much smaller amount) to cover one specific function, such as a handicap accessible remodel, describes Jackie Boies, a senior director of housing and bankruptcy services for Money Management International, a nonprofit debt counselor based in Sugar Land, Texas.