Reverse Mortgages for Seniors 62 and Older
A reverse mortgage lets homeowners 62 and older convert a portion of their home equity into cash — with no monthly mortgage payments required. You keep the title to your home and continue to live in it. The loan is repaid when you sell, move out, or pass away.
Reverse mortgages have been helping senior homeowners for more than fifty years. The most common type is the HECM (Home Equity Conversion Mortgage), which is FHA-insured and the most widely available option. Jumbo reverse mortgages are also available for higher-value homes.
Reverse Mortgage Requirements for Seniors
To qualify for a reverse mortgage:
- Age: Youngest borrower must be 62 or older (some jumbo programs start at 55)
- Primary residence: The home must be your primary residence — you must live in it
- Equity: Substantial equity required — most borrowers own their home free and clear or have a small remaining balance
- HUD counseling: Required for HECM loans — a brief session with an independent HUD-approved counselor before closing
- Property taxes and insurance: You must remain current on property taxes, homeowners insurance, and HOA fees
- Property types: Single-family homes, 2–4 unit properties (owner-occupied), HUD-approved condominiums, and manufactured homes meeting FHA requirements
How You Can Receive the Funds
Reverse mortgage borrowers choose from several disbursement options:
- Lump sum — receive all proceeds at closing (fixed-rate HECM only)
- Monthly payments — tenure (lifetime) or term (set period)
- Line of credit — draw funds as needed; the unused line grows over time
- Combination — mix of lump sum, monthly payments, and line of credit
The amount you can borrow depends on your age, current interest rates, and your home’s appraised value. Older borrowers with higher-value homes and lower interest rates generally qualify for more.
Advantages
- No monthly mortgage payments — you must still pay property taxes, insurance, and HOA
- Tax-free proceeds — loan funds are not considered income
- Non-recourse loan — you or your heirs will never owe more than the home is worth at repayment
- Flexible disbursement — cash, monthly income, or a growing line of credit
- Stay in your home — you retain title and the right to live in the property
Things to Consider
- Loan balance grows over time — interest accrues on the outstanding balance since no payments are made
- Equity decreases — the loan reduces the equity available to heirs
- SSI and Medicaid — HECM proceeds may affect eligibility for means-tested benefit programs
- Moving — if you move out permanently, the loan becomes due
Reverse Mortgage for Veterans
The VA home loan program does not offer a reverse mortgage. Veterans 62 and older use the standard HECM program — the same product available to all eligible seniors. There is no VA-specific reverse mortgage. Veterans should be cautious of any marketing claiming a special “VA reverse mortgage” product.
That said, veterans who have remaining VA entitlement may be able to use VA financing for their next primary residence purchase (such as a HECM for Purchase), while keeping a reverse mortgage on a prior home. Discuss your specific situation with a loan specialist.
HECM for Purchase
A HECM for Purchase (H4P) lets buyers 62+ purchase a new primary home using a reverse mortgage — with a larger down payment and no ongoing mortgage payments. This is a useful option for seniors downsizing or relocating who want to conserve cash flow in retirement.
Jumbo Reverse Mortgages
For homes valued above the FHA HECM loan limit ($1,149,825 as of 2024), jumbo reverse mortgage programs (also called proprietary reverse mortgages) are available. These allow access to more equity on higher-value homes, often starting at age 55 rather than 62.
Contact us to discuss which reverse mortgage program fits your situation.
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Talk to a licensed loan officer about your options — no obligation.