Add this to the long list of alternative ways to put money to work in the U.S. housing market: reverse mortgages that are in default.

Reverse mortgages allow borrowers 62 years or older to convert a portion of the equity in their homes into cash. Unlike a traditional home equity loan or second mortgage, however, borrowers do not have to repay the loan until they sell the home or no longer use it as their principal residence. In the meantime, the interest payment is added to the balance of the loan each month.

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