Get Life Quotes Today LLC is not a lender or mortgage broker and does not make loans. We are not affiliated with HUD, the FHA or any government agency. If you send the form, a licensed mortgage professional may contact you. The phone number elsewhere on this site is for life insurance only.
How a reverse mortgage works
Instead of you paying the lender each month, the lender pays you, and the amount you owe grows over time as interest and fees are added. Nothing has to be repaid until the last borrower dies, sells the home or moves out. Most reverse mortgages are Home Equity Conversion Mortgages (HECMs), which are insured by the Federal Housing Administration.
Who can qualify
- The youngest borrower is 62 or older (for a HECM)
- The home is your main residence
- You own the home outright or have substantial equity in it
- You can keep paying property taxes, homeowners insurance and upkeep
- You complete a counseling session with a HUD-approved counselor, which is required
How you can receive the money
- A single lump sum
- Fixed monthly payments
- A line of credit you draw on when you need it
- A combination of these
The costs and risks
Understand these before you speak with anyone about a loan.
- Upfront costs can be high: origination fees, mortgage insurance premiums and closing costs
- Interest is added to the balance every month, so the amount owed grows and your equity shrinks
- Less equity means less to leave to your heirs
- You must keep paying taxes, insurance and maintenance, or the loan can be called due
- The loan comes due if you move out, including a long stay in a care facility
- A spouse who is not on the loan may have limited rights to stay in the home
Alternatives worth comparing
Selling and downsizing, a home equity loan or line of credit, refinancing, and state or local property tax relief programs can all cost less. A HUD-approved counselor will go through these with you at no obligation. You can find one through HUD at hud.gov or by calling HUD's housing counseling line.
Reverse mortgages and life insurance
These are separate products. A reverse mortgage draws on your home equity while you are alive. Life insurance pays your beneficiaries after you die. Some families use a small policy to help heirs keep the home. Read about life insurance to protect a mortgage.
Common questions
Do I still own my home?
Yes. You keep the title. The lender has a lien on the home, as with any mortgage, and the loan is repaid when the home is sold or the last borrower leaves it.
Can I lose my home with a reverse mortgage?
Yes. The loan can be called due, and the home foreclosed on, if you stop paying property taxes or homeowners insurance, let the home fall into disrepair, or no longer live in it as your main residence.
What happens when I die?
The loan becomes due. Your heirs can repay it and keep the home, sell the home and keep anything left after the loan is paid, or hand the home to the lender. With a federally insured reverse mortgage, they will not owe more than the home is worth.
Is the money taxable?
Reverse mortgage proceeds are loan advances and are generally not treated as taxable income. They can affect need-based benefits such as Medicaid or Supplemental Security Income, so check before you apply.
Is there an upper age limit?
No. The minimum age is what matters. Older borrowers can generally access a larger share of their home's value.
This page is general information, not financial, legal or tax advice, and it is not an offer to lend. Loan terms, eligibility and costs depend on the lender and your circumstances. Borrowers have a right to cancel a reverse mortgage within three business days of closing.