A smart payment plan can refer to paying off a debt that you have, or even more than one debt by consolidating the debt and paying it via a specific payment schedule. Within a smart payment plan for financing, you would pay back a certain amount of money every month until your balance is paid off. Credit cards need more flexibility when it comes to smart payment plans. With credit cards, there is always a minimum required payment each month. The credit card holder can then decide how much more to pay back and when.
So what is the relationship between smart payment plans and reverse mortgages? Here is the explanation:
If you have a conventional mortgage on your home, some might say that the mortgage payments that you are making to your lender are a smart payment plan. In that you are paying a fixed amount of money each month.
Whereas, with a reverse mortgage, once you have your loan proceeds approved, unlike a conventional mortgage, there is no smart payment plan that you need to be on with your reverse mortgage lender.
So smart payment plans and reverse mortgages do not have a close relationship. That is one of the reasons why so many Americans get reverse mortgages in their senior years.