Which term describes a mortgage that has scheduled periodic payments made by the lender to the borrower?

A reverse mortgage is a financial product specifically designed for homeowners, usually seniors, which allows them to convert a portion of their home equity into cash. In this arrangement, the lender makes scheduled periodic payments to the borrower, rather than the borrower making payments to the lender as is traditional in most mortgage structures. This type of mortgage can be appealing for retirees who may need additional income without selling their home or for those who wish to age in place while accessing their home’s value.

In a reverse mortgage, the loan balance increases over time as the borrower receives payments, and repayment is not required until the borrower moves out of the home, sells the property, or passes away. The homeowner typically retains ownership of the home during their lifetime, allowing them to continue living there while accessing funds as needed. This unique structure differentiates it from other types of loans that involve periodic payments from borrowers to lenders.