Rouse said the reverse mortgage has been gaining momentum as more senior citizens, in particular women, are gravitating toward the service. “It is the elderly’s fundamental right. It is not to say that the bank has a gun to your head. It is you who called or approached them.” What has been attracting the interest of senior citizens was the widespread advertising on cable television, Rouse said.

“The advertisements tell you let your home pay for your care.” Rouse explained that the reverse mortgage first targeted single homeowners who had no dependents, but now elderly couples are getting roped into the trend. Any bank that offers a reverse mortgage, Mahabir said, should have some links with the insurance industry to calculate the expected life of the homeowner.

The government, Mahabir said, was duty-bound to look at the practice in order to regulate how institutions operate. “They must have the insurance companies fair accrual values. They must be able to have clauses where someone can revise the value of their house on a periodic basis.”

Mahabir said while the banks revise their interest rates at which they lend, people should be able to revise the house values periodically also for equity and fairness. The best thing for the homeowner to do was sell their property on the open market, Mahabir said.

The money collected should be invested in an institution. “When an individual has no one to leave his/her home to, they do not have to worry about capital preservation, so they can live off the interest earning, together with some of the earnings they got from their home.”

For more go to http://www.guardian.co.tt/business/2012-06-24/economist-reverse-mortages-unfair