Mortgage products are highly evolved in the US and the UK, while the innovations in mortgages similar to the ones in these countries are gaining momentum in the rest of the world. This article briefs on recent developments/innovations in the mortgage industry. It narrows down to give a detailed insight into the highly significant innovation - Reverse Mortgage, its evolution as well as fast penetration in India.

Real estate and equity are the two investments considered as capable of generating superior returns and outperforming inflation in the long-run. In case of real estate, if we consider home as an investment avenue, it has double advantage as an asset class. The first one is that it serves one of the three basic needs of food, clothing and shelter and the second, it also serves as a financial security in old age making it a real asset.

Recognizing the importance of home equity, many product innovations have taken place, especially in mortgage product offerings. This article is divided into two parts. The first part discusses some of the major mortgage products that have evolved in developed countries like the US, the UK, Canada and Australia whereas the second part focuses on a specific product `Reverse Mortgage' with reference to countries like the US, the UK and India. It also discusses reverse mortgage as a recent innovation in the Indian mortgage industry and its significance as innovative product and issues thereof.

Interest-only mortgage is a product which facilitates a customer mortgage requirement by giving him/her the option to make only interest payments and defer the principal amount repayment during the initial period. The payments thereafter are gradually increased and adjusted to cover both the interest and accelerated principal repayments to make up for the earlier deferred principal payments. "Interest-only mortgage loan is a popular way for borrowing money to buy an asset that is unlikely to depreciate at a high rate, which can be sold at the end of the loan to repay the capital."

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