FHA Reverse Mortgage

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Home Equity Conversion Mortgage or HECM is the only reverse mortgage insured by the U.S. Federal Government and is only available through an FHA approved lender. Reverse mortgages are popular among homeowners 62 and older who have either paid off their mortgage or have only a small mortgage balances remaining and want to supplement their income through equity in their home. Homeowners can receive payments in a lump sum, on a monthly basis (for a fixed term or for as long as they live in the home), or on an occasional basis as a line of credit.

The program was designed to allow seniors to purchase a new principal residence and obtain a reverse mortgage within a single transaction. The program was also designed to enable senior homeowners to relocate to other geographical areas to be closer to family members or downsize to homes that meet their physical needs, i.e., handrails, one level properties, ramps, wider doorways, etc.

Unlike ordinary home equity loans, a HUD reverse mortgage does not require repayment as long as the borrower lives in the home. Lenders recover their principal, plus interest, when the home is sold. The remaining value of the home goes to the homeowner or to his or her survivors.


Below are some requirements for a HECM: 
  • Be 62 years of age or older
  • Own the property outright or paid-down a considerable amount
  • Occupy the property as your principal residence
  • Not be delinquent on any federal debt
  • Have financial resources to continue to make timely payment of ongoing property charges such as property taxes, insurance and Homeowner Association fees, etc.
  • Participate in a consumer information session given by a HUD- approved HECM counselor
  • Single family home or 2-4 unit home with one unit occupied by the borrower
  • HUD-approved condominium project
  • Manufactured home that meets FHA requirements
  • Income, assets, monthly living expenses, and credit history will be verified.
  • Timely payment of real estate taxes, hazard and flood insurance premiums will be verified

There are no asset or income limitations on borrowers receiving HUD's reverse mortgages. There are also no limits on the value of homes qualifying for a HUD reverse mortgage.  To find out if you qualify for a reverse mortgage, give us a call and we would be happy to meet talk with your about your options.

Here is a link to our Reverse Mortgage Calculator


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NRMLA (National Reverse Mortgage Lenders Association) provides a consumer guide to answer common questions about reverse mortgages. To download - Just the FAQs: Answers to Common Questions About Reverse Mortgages – please click here to be directed to our downloadable resource page. If you are a financial planner, attorney, or other professional who works with elderly clients, you may also receive one complimentary copy of the booklet via mail delivery by calling 1-866-264-4466 (toll free).