Final Answer:
Reverse mortgages, tailored for those aged 62+, don't necessitate monthly payments; instead, homeowners receive funds based on equity. This financial tool is designed to ease cash flow without conventional repayment obligations. Thus the correct option is option (C).
Step-by-step explanation:
Reverse mortgages are a financial product designed for homeowners aged 62 and older to convert a portion of their home equity into cash. The statement that is false is option C, which suggests that reverse mortgages require monthly mortgage payments from the borrower. In reality, one of the key features of a reverse mortgage is that it allows homeowners to receive payments from the lender, effectively reversing the traditional mortgage payment structure. Instead of making monthly payments to the lender, the homeowner receives funds from the lender.
The other statements are accurate. Option A correctly states that reverse mortgages are typically available to individuals aged 62 and older. Option B is also true, as homeowners with a reverse mortgage are still responsible for property taxes and insurance. Option D accurately reflects that the loan amount of a reverse mortgage is based on the home's equity.
To further elaborate, reverse mortgages work by allowing homeowners to borrow against the equity in their homes. The loan amount is determined by factors such as the borrower's age, the home's appraised value, and current interest rates. Unlike traditional mortgages, reverse mortgages do not require monthly repayments. Instead, the loan is repaid when the homeowner sells the home, moves out of the home, or passes away. Thus the correct option is option (C).