POSTED: 5:07 p.m. PST January 24, 2003

Bebe Emerman
KIRO 7 Eyewitness News Consumer Investigator

It's billed as a possible solution for seniors dealing with a mounting debt of living expenses, medical bills and costly home repairs.

More Information On This Story Reverse mortgage information from AARP

But there are drawbacks.

It's an all-to-common concern: an elderly couple struggles on a fixed income. But there is an option for homeowners.

It's called a reverse mortgage. It frees up cash for people over 62 and allows them to keep the title to their home.

Mary Kilpatrick is all smiles now, showing off some $15,000 in repairs to her home.

She is especially glad she no longer needs buckets to catch rainwater that poured through a leaky dining room roof.

Kilpatrick thought her home would fall into horrible disrepair, until she found out about something called a reverse mortgage.

"The children noticed I was getting stressed out 'cause I needed the work done on it," she said.

She calls the reverse mortgage a blessing. It allowed her to get the equity built up in her home without having to move or sell the property.

Reverse mortgages are available in every state, but there are some rules.

You must be at least 62 years old and the amount of money received is based on where you live and the value of the house.

"Early on, there were some misconceptions that this is a program where you give your house to the bank that they in turn give you money. That is not the case at all," said Jeffrey Taylor of Wells Fargo.

Once the homeowner passes away or moves out, the estate has the option of buying back the home or settling with the bank.

AARP says that's the rub.

While the organization supports reverse mortgages as an option, they caution homeowners to educate themselves.

AARP says a reverse mortgage can, in essence, wipe out any planned inheritance parents planned to leave their children.

The money from a reverse mortgage can be used for almost anything -- daily living expenses, medical bills, home repairs, even a dream vacation.

And seniors can choose how they want the money, fixed monthly payments or one lump sum.