How would you like your bank to hand you a monthly mortgage payment instead of the other way around? That's what happens with a reverse mortgage.

Seniors who own their homes outright, or nearly so, can boost their income in retirement by getting tax-free cash from their home equity while they stay in their homes.

However, consumer advocates warn that a reverse mortgage must be approached carefully, because it comes with steep fees and other pitfalls.

Nationwide, sales of the main kind of reverse mortgages grew from 8,127 in 2001 to 14,181 in 2002.

In a reverse mortgage, seniors 62 and older can take a loan against their homes and receive monthly payments from the lender as long as they live. Or they can take a lump-sum payment. Or they can choose to take monthly payments for a certain period -- say 10 or 15 years.

In many states, borrowers can also get a reverse mortgage line of credit. Borrowers retain the title and ownership of the home. The lender, however, gets a lien.

The principal and interest on the reverse mortgage are not due until the borrower or borrowers die. The loan also has to be paid off if the borrowers sell the home or move out for more than 12 months. Sometimes the loan is paid with proceeds of the sale of the home after the owners' deaths.

A reverse mortgage can be a great option for seniors who need additional income to meet their living expenses, particularly if the home is their only big asset. But there are downsides. If you want to leave your home to your kids free and clear, a reverse mortgage will prevent that.

A reverse mortgage comes with high costs. Origination fees may be as high as 2 percent of the value of the home, and the mortgage insurance -- which is mandatory -- may also be as high as 2 percent. There are costs for title insurance, an appraisal, a survey and a servicing charge that can reach $35 a month.

Borrowers can choose whether they want the rate to change monthly or yearly. Unlike regular mortgages, consumers don't have to shop for rates, because the rate is based on a formula set by Fannie Mae -- a set amount added to the yield of the one-year Treasury bill. Currently the rate is 2.85 percent for the monthly option and 3.45 percent for the annual option.