The Federal Housing Administration (FHA) has requested an additional $800 million in funding, according to a recent Washington Post article. The funding is meant to help offset growing losses stemming from the drop in home values that underlie FHA reverse mortgages. While that might sound scary to potential reverse mortgage borrowers, it's actually evidence of many seniors coming out ahead on reverse mortgage transactions, versus other methods of accessing their home equity.

In a stable or growing real estate market, the amount of equity most seniors end up accessing is far less than what the FHA may eventually sell their home for. This normally ensures that the FHA, who backs reverse mortgages, comes out even or ahead on the transaction. However, with the recent steep declines in home values, properties sold to cover reverse mortgage balances aren't measuring up.

One encouraging note is that the FHA appears committed to not passing these losses on to other seniors in the program. By asking the government for additional funds, the FHA is attempting to shift any increased cost away from existing or new reverse mortgage borrowers.

For more information on reverse mortgages, check out the following articles:

• Reverse Mortgage Basics
• Disadvantages of a Reverse Mortgage
• Using a Reverse Mortgage Calculator