More time
Compare costs and alternatives, involve family and advisors, and ask questions without the pressure of a sudden change in circumstance.
Strategic Home Equity GuideReverse mortgage planning for age 62+A strategic home equity guide for homeowners age 62+
Your home equity can be a planning asset before it becomes a retirement need.
For homeowners with a solid plan and meaningful equity, an FHA-insured Home Equity Conversion Mortgage can provide another source of liquidity and flexibility. A plan is most valuable when it is created before life makes the decision for you.
Options before urgencyEducation before applicationFamily and advisors welcome
Eight plain-English resources for homeowners who want to plan ahead instead of react under pressure.
Planning assetBasicsPlanning checkStrategic usesCostsFamilyProcessFAQs
Resource 01
The house belongs in the retirement plan.
Home equity often appears on a net-worth statement but has no assigned job. A Home Equity Conversion Mortgage can turn part of that equity into accessible liquidity through a line of credit, monthly advances, a lump sum, or a combination of options.
More choice
Explore available borrowing capacity while the decision is still optional, not after a market decline, health event, or cash-flow disruption forces the issue.
Better coordination
Consider home equity alongside Social Security, investments, taxes, housing, healthcare, and legacy goals instead of treating the house as a separate plan.
The flexible retirement bucket
Home equity is the “Swiss Army Knife” of retirement buckets.
The money does not have to be spent simply because access is available. It can remain a standby resource that supports another part of the plan when timing or circumstances change.
Learn early. Borrow strategically.
Earlier is not automatically better for every homeowner. Closing costs, interest, mortgage insurance, and accessing future home equity must be weighed carefully. But waiting for an urgent need can leave less time and fewer choices. A review today can end with “not now” and still be valuable.
Resource 02
A reverse mortgage loan is still a mortgage.
A Home Equity Conversion Mortgage, or HECM, is the FHA-insured version of the reverse mortgage loan. It turns part of your home equity into loan proceeds while you continue owning and living in the home.
You keep the title
You remain the titleholder. The home secures the loan, just as it does with a traditional mortgage.
No required monthly principal and interest payment
Voluntary payments are allowed. Property taxes, homeowners insurance, maintenance, and occupancy obligations continue.
The loan balance grows
Funds borrowed, interest, and mortgage insurance are added to the balance. Remaining home equity may decline over time.
The loan is repaid later
Repayment is usually triggered when the last eligible borrower sells, permanently leaves the home, or passes away.
Plain-English definition
You are borrowing home equity, not selling your home.
The proceeds are loan advances, not free money. A complete review looks at both sides: what the loan may make possible and how it may influence the home equity ultimately available to the homeowner or heirs.
Read the CFPB explanationResource 03
Could understanding it today give you more choices tomorrow?
The goal is not simply to determine whether you qualify. It is to consider time, stability, and whether there is a clear reason to explore home equity before it becomes an urgent need.
01
Will every borrower be at least age 62 at closing?
A younger spouse may sometimes be included as a Non-Borrowing Spouse, but that changes the available proceeds and protections.
02
Is this home your principal residence?
A HECM is designed for the home where you live for most of the year.
03
Do you own the home outright or have meaningful equity?
Any current mortgage, second mortgage, or HELOC must be paid off at closing, often with HECM proceeds.
04
Do you expect to remain in the home for several years?
The upfront costs are usually easier to evaluate when the home fits your longer-term plan.
05
Can you continue paying property taxes, homeowners insurance, and home maintenance?
These responsibilities continue for as long as the loan remains in place.
06
Could additional liquidity help you protect and support the retirement plan you already have?
The strongest strategic cases are often not emergencies.
07
Would you rather evaluate this now, or during a market decline, after a health event, or cash-flow emergency?
Time gives you room to compare the costs, alternatives, and effect on future home equity.
08
Are you willing to coordinate the decision with family and/or the professionals who know your plan?
A financial advisor, tax professional, or estate attorney can help evaluate how home equity fits into your retirement plan and with your other assets.
Resource 05
Costs and responsibilities, clearly explained
Including closing costs in the loan can reduce the amount needed upfront, with those expenses becoming part of the balance repaid later.
Upfront FHA mortgage insurance
The initial mortgage insurance premium for a HECM is 2% of the appraised home value or maximum claim amount.
Annual FHA mortgage insurance
The annual premium is 0.5% of the outstanding balance and accrues monthly to the loan.
Origination and third-party costs
Origination fees are capped by FHA rules. Appraisal, title, recording, credit, inspection, counseling, and other charges may also apply.
Interest
Interest accrues on the amount borrowed and is added to the loan balance. Fixed and adjustable options have different financing features.
Voluntary repayment
You may repay some or all of the balance without a required monthly schedule, subject to the loan terms.
Resource 06
What your spouse and heirs should know
A reverse mortgage loan does not prevent heirs from inheriting the home. It does mean the loan must be satisfied when the last eligible borrower or qualifying spouse no longer occupies the home.
Spouse protection starts before closing
Co-borrower and Non-Borrowing Spouse are not the same.
A co-borrower keeps the borrower rights while the loan remains in good standing. An Eligible Non-Borrowing Spouse may qualify for a deferral after the borrower passes away, but must continue meeting HUD requirements and does not receive additional loan advances.
Review spouse protectionsIs the home worth more than the HECM balance?
Does the family want to keep the home?
Likely family path
Choose both answers to see the likely path.
This is a conversation guide. The loan servicer provides the controlling payoff figures and instructions.
After the last borrower passes away
The verified timeline has two clocks.
First, the servicer checks for a surviving borrower or qualifying spouse deferral. If neither applies, the due-and-payable process begins.
From the due-and-payable notice, the estate or heirs have 30 days to engage with the servicer about paying, selling, or providing a deed in lieu.
The servicer must generally take the first legal action to initiate foreclosure within six months of the last borrower’s passing or the end of a deferral period.
HUD may approve additional time when the estate documents active efforts to sell the home or satisfy the balance.
Important: six months plus as many as two 90-day extensions is possible.
It is not an automatic 12-month grace period. Each extension is conditional and must be requested through the servicer before the current deadline expires.
Resource 07
From curiosity to closing, you remain in control
Learn what’s possible for you. Ask questions and make a fully informed decision. We’ll be right with you the entire time.
Start with the plan, not the product
Clarify what greater flexibility should accomplish before discussing a loan structure.
Establish the foundation for your review
Date of birth, address, current mortgage balance including any second mortgage or HELOC, and current estimated property value.
Review a preliminary illustration
See estimated proceeds, costs, payment choices, and future balance examples. No application or commitment required.
Complete independent HUD counseling
A HUD-approved counselor reviews the program, alternatives, costs, and responsibilities.
Submit an application
The formal process includes disclosures, financial assessment, title work, and an appraisal.
Choose how to access your funds
Select the plan that best matches your goals and the loan options available.
Close and keep the plan coordinated
Continue meeting the loan obligations and keep important family members and advisors informed. Our team will be there for the entire life of the loan.
Independent education is built in
HUD counseling is required before the loan can proceed.
The counselor does not sell the loan. The session covers program mechanics, alternatives, costs, responsibilities, and the effect on your household.
Find HUD-approved counselingResource 08
Questions worth asking before you decide
Careful consideration is part of the process. A good decision should survive direct questions, realistic numbers, and family conversation.
Why consider this if I do not need the money today?
Because time improves the quality of the decision. You can compare costs and alternatives, involve family and advisors, and decide whether standby borrowing capacity would strengthen the rest of your plan. A review may still end with “not now,” which is a useful answer when it is reached without pressure.
Does learning early mean I should close a loan early?
No. Early education and early borrowing are different decisions. Closing costs, interest, mortgage insurance, available proceeds, and the effect on future equity should be evaluated against the value of having access available.
Do I give up ownership of my home?
No. The title remains in your name, just as it does with a traditional mortgage. The home secures the loan, and you remain responsible for the loan obligations.
Do I have to make a monthly mortgage payment?
There is no required monthly principal and interest payment. You may make voluntary payments at any time. Property taxes, homeowners insurance, maintenance, and occupancy requirements continue.
Can I have a current mortgage and still qualify?
Yes! However, we recommend 70% equity in the home in order to take advantage of all the benefits. Your current mortgage, second mortgage, or HELOC must be paid off at closing. HECM proceeds may be used for that payoff, but the available proceeds must be sufficient.
How much can I receive?
The amount depends on the age of the youngest borrower or applicable spouse, the home value, current interest-rate assumptions, FHA limits, existing liens, and the payment option selected.
Can the lender take my home?
A HECM is a mortgage, so default can lead to foreclosure. The key protections are also clear: continue living in the home as your principal residence, pay property taxes and homeowners insurance, and maintain the property.
What happens if I move?
When the home is no longer the principal residence of an eligible borrower or qualifying spouse, the loan generally becomes due and payable. Most homeowners repay it by selling the home or using other funds.
Can my heirs keep the home?
Yes, if they repay the amount required by the servicer. For an FHA-insured HECM, eligible heirs may generally keep the home by paying the lesser of the loan balance or 95% of the current appraised value.
Is HUD counseling really required?
Yes. Before a HECM can move forward, you must meet with an independent HUD-approved counselor. Counseling is education, not a commitment to proceed.
Reference desk
Official sources and review notes
Program rules change. Confirm current requirements, costs, and available options for every household and transaction. Sources reviewed July 2026.
HUDFHA Reverse Mortgage for SeniorsCFPBReverse mortgage consumer centerCFPBEligibility requirementsCFPBPayment optionsCFPBBorrower responsibilitiesCFPBOptions for heirseCFR24 CFR Part 206HUDHousing Counseling Handbook 7610.1CFPBReverse mortgage discussion guideIRSReverse mortgage proceeds and taxesSSADelayed retirement creditsCFPBCaution when borrowing solely to delay Social Security