Tenure Payment Plan

Own a home and want to use it as a steadily paying cash cow (i.e. you take out a reverse mortgage on your home, gradually depleting its equity value as the home takes on more and more debt)? That’s what a tenure payment plan is for.

Tenure payment plans run with you taking out a reverse mortgage on your home. All or part of the equity that’s already been paid off can be taken out and used to make regular, fixed monthly payments, as long as you keep using the home as your primary residence.

Banks make money off of reverse mortgages like any regular old loan: via interest. With each monthly payment, the bank charges interest to the loan. If you’d rather get a single lump-sum payment, you can do that too—but it’ll cost you in terms of higher interest.

The tenure payment plan is an okay-ish option for retired folks who just want to live out their days mostly at home, with a fixed income...assuming they don’t want to leave the house to their kids. If you have a tenure payment plan, the bank gets repaid for what you borrowed with your home.