Your loan is usually disbursed in one of the following ways:

* A lump sum that is given to you or used to pay off debt or a combination of the two.

* Fixed monthly payments that will be made to you for a set period of time.

* Fixed monthly payments that will be made to you as long as you live in the home. These payments will be smaller than the ones in the previous option.

* As a line of credit.

* As a combination of a credit line and one of the payment options.

Some potential drawbacks of reverse mortgages are:

* You can only use your equity once. If you use it to live on and have an emergency later it will not be there.

* There can be substantial fees involved with reverse mortgages. There may be upfront fees as high as $5000 dollars. It is wise to do some comparative shopping when it comes to this type of financing.

* Your payment amount may not meet your needs. How much good will $100 a month do you if it is going to cost you the equity in your home?

* Your ability to receive government pay outs such as SSI and Medicaid may be affected.

* Make sure your lender is reputable. The names of reputable lenders can be gotten from the Department of Housing Urban Development.

* Upon death, if repayment has not been made, your home will go to the lender. This may not necessarily be a bad thing, but it is something to consider.