Reverse Mortgages for Homeowners 62+

Written and reviewed by Jack Gladden, Senior Loan Officer, NMLS #1470164
Updated October 12, 2026 · 5-minute read · How these guides are written

On this page

How it works
Who qualifies
Costs
Your obligations
Heirs
Alternatives
How we start
Questions

Reverse mortgages in brief

What it is: A loan for homeowners 62 and older that turns home equity into cash, with no monthly mortgage payment required while you live there.
The common kind: The FHA-insured Home Equity Conversion Mortgage (HECM); private “jumbo” reverse mortgages exist for higher-value homes.
Who qualifies: The youngest borrower is at least 62, the home is your primary residence, and you have significant equity.
Counseling: A session with a HUD-approved counselor is required before you apply.
Your obligations: You still pay property taxes, insurance and HOA dues, and keep the home in good repair.
When it’s repaid: When the last borrower sells, moves out or passes away, usually from the sale of the home. With an FHA-insured HECM, you or your heirs never owe more than the home is worth.

How a reverse mortgage works.

Instead of you paying the lender each month, the loan balance grows: interest and mortgage insurance are added to it over time. The amount you can borrow depends mainly on the age of the youngest borrower, the home’s value up to HUD’s limit ($1,249,125 for 2026), and interest rates. Any existing mortgage is paid off first from the proceeds.

Lump sum

All at once at closing, with a fixed rate.

Best forPaying off a mortgage or a large expense

Line of credit

Draw when you need it; the unused portion can grow over time.

Best forA safety net for later years

Monthly payments

Fixed monthly amounts for life, while you live in the home, or for a set term.

Best forSteady extra income

HECM for Purchase

Buy a new home with a reverse mortgage and a down payment, with no monthly mortgage payment.

Best forDownsizing or moving closer to family

Who qualifies.

Requirement	HECM rule
Age	The youngest borrower is 62 or older; a younger spouse can be protected as an eligible non-borrowing spouse.
Home	Your primary residence: a single-family home, 2–4 units you live in, an FHA-approved condo, or an eligible manufactured home.
Equity	Enough that any existing mortgage can be paid off from the proceeds.
Counseling	Completed with a HUD-approved counselor before you apply.
Ability to pay property costs	The lender reviews income and credit to make sure taxes and insurance can be paid; if not, part of the loan may be set aside for them.

Thinking about a reverse mortgage?

Tell me the home’s value, your age and any balance you owe. I’ll show you what a reverse mortgage could provide, and how it compares with alternatives.

Explore my options →

What it costs.

FHA mortgage insurance: An upfront premium of 2% of the home’s value (up to HUD’s limit) and an annual premium of 0.5% of the balance.
Closing costs: Origination, appraisal, title and other fees, usually financed into the loan.
Interest: Added to the balance, so the amount owed grows over time and your equity shrinks.

Because most costs are financed, a reverse mortgage is expensive if you move within a few years. It works best for owners who plan to stay.

Your obligations, and the risks.

Keep paying property costs. Missing property taxes, insurance or HOA dues can make the loan due, and can lead to foreclosure.
Live there. The home must stay your primary residence; a long stay away, such as more than a year in care, can make the loan due.
Maintain the home. Keep it in good condition.
Less to leave behind. The growing balance reduces the equity left for you or your heirs.

What happens for your heirs.

When the last borrower passes away, heirs can sell the home and keep any equity left after the loan is repaid, or keep the home by paying off the balance. A HECM is non-recourse: if the balance is more than the home is worth, FHA insurance covers the difference, and heirs who want to keep the home can usually pay 95% of its appraised value instead of the full balance.

Alternatives to consider.

Option	When it fits
Downsizing	You’re ready to move and want to unlock equity without new debt.
HELOC or home equity loan	You can make monthly payments; see HELOCs.
Cash-out refinance	You want a lump sum and can afford a new payment; see cash-out.
Local programs	Many states and counties offer property tax relief or repair help for seniors.

How we get started.

Talk it through
Your goals, the home, and who in your family should be involved.
Counseling
Your session with a HUD-approved counselor, required before applying.
Apply and appraise
The lender reviews the home and your ability to pay property costs.
Close
With a three-day right to cancel before funds are available.

Reverse mortgages, answered plainly.

How does a reverse mortgage work?

A reverse mortgage lets homeowners 62 and older turn part of their home equity into cash, as a lump sum, monthly payments or a line of credit, with no monthly mortgage payment required. You keep ownership, must live in the home as your primary residence, and must keep paying property taxes, insurance and upkeep. The loan is repaid when the last borrower sells, moves out or passes away. With an FHA-insured reverse mortgage (HECM), you and your heirs never owe more than the home is worth when it is sold. It can also be used to buy a new home, and independent HUD-approved counseling is required before you apply.

How much money can I get with a reverse mortgage?

It depends on the youngest borrower’s age, current rates and the home’s value up to the 2026 limit of $1,249,125; older borrowers can get more. Any existing mortgage is paid off first. I’ll show you your estimate. See also: Reverse mortgage vs HELOC.

What disqualifies you from a reverse mortgage?

Being under 62, a home that isn’t your primary residence, too little equity to pay off your current mortgage, or an ineligible property such as some condos. See also: Reverse mortgage vs HELOC.

What is the biggest problem with a reverse mortgage?

Costs and a growing balance that reduces your equity, plus the risk of the loan coming due if property taxes or insurance aren’t paid. See also: Reverse mortgage vs HELOC.

What are the three main requirements?

Being 62 or older, living in the home as your primary residence, and having significant equity, plus completing HUD-approved counseling.

What happens to my home when I die?

Your heirs can sell it and keep any remaining equity, or pay off the loan to keep it. With an FHA-insured HECM, they never owe more than the home is worth.

What is a better option than a reverse mortgage?

Sometimes downsizing, a HELOC, or a cash-out refinance; the right one depends on your income, plans and family. I’ll compare them with you.

What is a reverse mortgage, and why do people call it bad?

It lets homeowners 62 and older borrow against their home with no monthly payment; the loan is repaid when they sell, move out or pass away. It isn’t bad, but it is costly upfront, the balance grows over time, and it leaves less equity for heirs, so it fits people who plan to stay and want to use their equity.

What does a reverse mortgage cost?

Costs include an origination fee capped by federal rules, the FHA mortgage insurance premium and normal closing costs, and most can be paid from the loan. Compare the total cost on each lender’s disclosure.

Are reverse mortgages available in every state?

Yes. FHA-insured reverse mortgages (HECMs) are available nationwide. I arrange them in the states where I’m licensed: Arizona, California, Florida and Ohio. See also: Reverse mortgage vs HELOC.