What we verified in “Reverse mortgages (HECM): how they work and what to know”

Statements and where we checked them

The statements with rules, figures or dates, with the exact place in the source and the date we checked them.

1. According to HUD, the only reverse mortgage insured by the federal government is the Home Equity Conversion Mortgage (HECM), available only through an FHA-approved lender; it lets you withdraw a portion of your home's equity for maintenance, repairs or general living expenses; you may stay in your home indefinitely as long as property taxes and homeowners insurance are kept current; to find a reverse mortgage counselor, HUD points to its HECM Counselor Roster or (800) 569-4287; and it warns about scam artists who charge thousands of dollars for information that is free from HUD.

   Sources 1 · Home Equity Conversion Mortgages for Seniors: 'The only reverse mortgage insured by the U.S. Federal Government is called a Home Equity Conversion Mortgage (HECM), and is only available through a Federal Housing Administration (FHA)-approved lender'; 'withdraw a portion of your home's equity to use for home maintenance, repairs, or general living expenses'; 'HECM borrowers may reside in their homes indefinitely as long as property taxes and homeowner's insurance are kept current'; 'search the HECM Counselor Roster or call (800) 569-4287'; 'beware of scam artists that charge thousands of dollars for information that is free from HUD' · Checked October 17, 2026

2. According to HUD, the amount available varies by borrower and depends on the age of the youngest borrower or eligible non-borrowing spouse, the current interest rate, and the lesser of the appraised value, the HECM FHA mortgage limit or the sales price; you can also use a HECM to buy a primary residence if you pay the difference between the HECM proceeds and the price plus closing costs with your own cash.

   Sources 1 · Home Equity Conversion Mortgages for Seniors: 'The amount that will be available for withdrawal varies by borrower and depends on'; 'Age of the youngest borrower or eligible non-borrowing spouse'; 'Current interest rate'; 'Lesser of appraised value or the HECM FHA mortgage limit or the sales price'; 'You can also use a HECM to purchase a primary residence' · Checked October 17, 2026

3. According to the CFPB, the HECM is the most common type of reverse mortgage and is only for homeowners 62 and older; as with a traditional mortgage, your home secures the loan and the title stays in your name; but you make no monthly mortgage payments, and the loan is repaid when you no longer live in the home; interest and fees are added to the balance each month, so what you owe rises over time and your equity falls; it is not free money; and you or your heirs will have to repay it, usually by selling the home. Meanwhile, you must pay property taxes and homeowners insurance, live in the home as your principal residence and keep it in good condition.

   Sources 3 · What is a reverse mortgage? (reviewed August 28, 2026): 'a special type of home loan only for homeowners who are 62 and older'; 'the title to your home remains in your name'; 'borrowers don't make monthly mortgage payments'; 'The loan is repaid when the borrower no longer lives in the home'; 'Interest and fees are added to the loan balance each month and the balance grows'; 'As your loan balance increases, your home equity decreases'; 'A reverse mortgage loan is not free money'; 'borrowed money + interest + fees each month = rising loan balance'; 'usually by selling the home'; 'homeowners are required to pay property taxes and homeowners insurance, use the property as their principal residence, and keep their house in good condition' · Checked October 17, 2026

4. According to the CFPB, be wary of contractors who suggest a reverse mortgage to pay for repairs, because it may be a scam, and don't let yourself be pressured; VA does not offer reverse mortgages, and some ads falsely promise veterans special deals or a 'no-payment' reverse mortgage; with most reverse mortgages you have three business days after closing to cancel for any reason without penalty, by notifying the lender in writing (the CFPB suggests certified mail with a return receipt); and after you cancel, the lender has 20 days to return the money you paid.

   Sources 3 · What is a reverse mortgage?: 'Beware of contractors who approach you about getting a reverse mortgage loan to pay for repairs to your homes. It may be a scam'; 'Don't let yourself be pressured into getting a reverse mortgage loan'; 'The Department of Veterans Affairs (VA) does not offer any reverse mortgage loans'; 'Within three business days after the loan is closed, you can cancel the deal for any reason, without penalty'; 'you must notify the lender in writing'; 'Send your letter by certified mail, and ask for a return receipt'; 'the lender has 20 days to return any money you've paid' · Checked October 17, 2026

5. According to the CFPB, besides age, for a HECM your home must be your principal residence (you live there most of the year); you must own it outright or have a low balance you can pay off at closing, with your own money or reverse mortgage funds; you cannot owe federal debt such as federal income taxes or federal student loans, though you can pay it with reverse mortgage money; you must have enough money, or set aside loan funds at closing, for taxes, insurance, maintenance and repairs; your home must be in good shape, and if it does not meet the standards the lender tells you what to repair first; and you must receive counseling from a HUD-approved reverse mortgage counseling agency.

   Sources 4 · Can anyone take out a reverse mortgage loan? (reviewed August 28, 2026): 'Your home must be your principal residence, meaning you live there the majority of the year'; 'You must either own your home outright or have a low mortgage balance'; 'You can use your own funds or money from the reverse mortgage to pay off your existing mortgage balance'; 'You cannot owe any federal debt, such as federal income taxes or federal student loans'; 'agree to set aside part of the reverse mortgage funds at your loan closing to pay ongoing property charges'; 'Your home must be in good shape'; 'the lender will tell you what repairs need to be made before you can get a reverse mortgage loan'; 'You must receive counseling from a HUD-approved reverse mortgage counseling agency to discuss your eligibility, the financial implications of the loan, and other alternatives' · Checked October 17, 2026

6. According to the CFPB, before a reverse mortgage it makes sense to look at other options: waiting, because if you take one out too young you may run out of money when you are older; a home equity loan or line of credit, which might be cheaper but carry their own risks, usually have monthly payments and depend on your income and credit; refinancing; downsizing; and lowering your expenses through state and local programs.

   Sources 4 · Can anyone take out a reverse mortgage loan?: 'waiting a while, using a home equity loan or line of credit, refinancing, downsizing, and lowering your expenses'; 'you may run out of money when you're older'; 'might be a cheaper way to borrow cash against your equity'; 'these loans carry their own risks and usually have monthly payments'; 'Qualifying for these loans also depends on your income and credit' · Checked October 17, 2026

7. According to the CFPB, as long as you live in the home, a reverse mortgage does not change who can live with you; but if you die or move out (including for medical reasons for more than 12 consecutive months), the loan becomes due; a co-borrower can stay in the home; a spouse who did not sign the loan may be able to stay without paying the balance if they qualify under HUD's rules; and children, relatives or others who are not co-borrowers have the option to pay off the balance with other funds to stay; to find a HECM counselor, it lists HUD's (800) 569-4287.

   Sources 5 · Does having a reverse mortgage impact who can live in my home? (reviewed January 2, 2025): 'having a reverse mortgage does not change who can live with you'; 'including moving for medical reasons for more than 12 consecutive months'; 'your co-borrower can stay in the home even if you die or move out of the home'; 'your spouse may be able to remain in the home without paying the loan balance'; 'if your spouse qualifies under the Department of Housing and Urban Development (HUD)'s rules'; 'will have the option to pay off the HECM loan balance in order to remain in the home'; '(800) 569-4287' · Checked October 17, 2026

8. According to the CFPB, when the last borrower dies the loan must be repaid, and most heirs repay it by selling the home; if the balance is more than the home's value, your heirs won't have to pay more than 95 percent of the appraised value, and mortgage insurance covers the rest.

   Sources 6 · What happens if my reverse mortgage loan balance grows larger than the value of my home? (reviewed July 11, 2022): 'When the last remaining borrower passes away, the loan has to be repaid'; 'Most heirs will repay the loan by selling the home'; 'your heirs won't have to pay more than 95 percent of the appraised value'; 'The remaining balance of the loan is covered by mortgage insurance' · Checked October 17, 2026

9. According to HUD's fact sheet for heirs, a HECM borrower makes no payments while living in the home, but the balance becomes due when the borrower sells, no longer lives there as a primary residence, or the last surviving borrower dies; the loan must be satisfied within 30 days of the borrower's death, and the lender may approve 90-day extensions if the estate or heirs are actively trying to sell or repay; taxes and insurance remain the estate's responsibility until title is transferred; if the balance is more than the home is worth, they may sell it for at least 95 percent of the current appraised value and the lender accepts the net proceeds as satisfaction; to keep the home, the balance must be paid in full; and a non-borrowing spouse has special provisions, including giving the lender a certification within 30 days of the death.

   Sources 2 · Inheriting a Home Secured by an FHA-insured Home Equity Conversion Mortgage (September 2019; column layout, checked by hand): 'The borrower makes no payments on the loan while living in the'; 'the loan balance becomes due and payable when the borrower either'; 'sells the home, no longer occupies it as their primary residence, or upon the death'; 'The loan must be satisfied within 30 days of the date of the borrower's death'; 'The lender may approve 90-day extensions with satisfactory documentation'; 'Property taxes and insurance on the property remain the responsibility of the'; 'more than the home is worth, the estate or heirs may sell the home for at least'; '95-percent of the current appraised value and the lender will accept the net'; 'If you prefer to keep the home instead of selling it, the HECM loan balance must'; 'available that may postpone repayment'; 'Spouse Certification within 30 days of' · Checked October 17, 2026

10. Under HUD's regulation (24 CFR §206.33), the youngest borrower must be 62 or older at loan closing.

    Sources 11 · 24 CFR §206.33: 'The youngest borrower shall be 62 years of age or older at the time of loan closing' · Checked October 17, 2026

11. Under HUD's regulation (24 CFR §206.39), the home must be the principal residence of each borrower, and of any eligible non-borrowing spouse, at closing; and on a HECM for Purchase, they must move in within 60 days of closing.

    Sources 12 · 24 CFR §206.39(a) ('The property must be the principal residence of each borrower, and if applicable, Eligible Non-Borrowing Spouse, at closing') and (b) ('must occupy the property within 60 days from the date of closing') · Checked October 17, 2026

12. Under HUD's regulation (24 CFR §206.41), at the first contact the lender must give you a list of approved HECM counselors with their names, addresses and phone numbers; the borrower, any non-borrowing spouse (eligible or not) and any non-borrowing owner must receive counseling; if there is an eligible non-borrowing spouse, the counselor must explain that they will need to obtain ownership or another legal right to remain for life when the last borrower dies and that the home must be their principal residence; if the spouse is not eligible, that the loan will become due when the last borrower dies; and the counselor gives you a certificate that you provide to the lender.

    Sources 13 · 24 CFR §206.41(a) ('the mortgagee shall give the borrower a list of the names, addresses, and telephone numbers of HECM counselors'; 'The borrower, any Eligible or Ineligible Non-Borrowing Spouse, and any non-borrowing owner must receive counseling'), (b)(2) ('must obtain ownership of the property or other legal right to remain in the property for life'), (b)(3) ('The HECM will become due and payable upon the death of the last surviving borrower') and (c) ('a certificate stating that the borrower'; 'has received counseling') · Checked October 17, 2026

13. Under HUD's regulation (24 CFR §206.19), the ways to receive the money are: equal monthly payments for a fixed number of months (term); equal monthly payments as long as the loan conditions are met (tenure); a line of credit you draw when and as you choose; a combination of monthly payments and a line of credit; and a single lump sum, available only on fixed-rate HECMs.

    Sources 9 · 24 CFR §206.19(a) ('equal monthly payments are made by the mortgagee to the borrower for a fixed term of months'), (b) ('Tenure payment option'), (c) ('payments are made by the mortgagee to the borrower at times and in amounts determined by the borrower'), (d) ('Modified term or modified tenure payment option') and (e) ('The Single Lump Sum payment option will be available only for fixed interest rate HECMs') · Checked October 17, 2026

14. Under HUD's regulation (24 CFR §206.27), the borrower must insure the home, keep it in good repair and pay property charges; the borrower has no personal liability for the balance: the lender can enforce the debt only through sale of the home and cannot obtain a deficiency judgment after foreclosure; the balance becomes due if a borrower dies and the home is not the principal residence of another borrower (except for the deferral for an eligible non-borrowing spouse), if the borrower conveys all title, if the home stops being the borrower's principal residence for another reason, if the borrower is away for more than 12 consecutive months because of physical or mental illness, if property charges are not paid or if another obligation is not performed; and no disbursements are made during a deferral period.

    Sources 10 · 24 CFR §206.27(b) ('in no event may disbursements continue during a Deferral Period'; 'The borrower must keep the property in good repair'; 'The borrower must provide for the payment of property charges'; 'The borrower shall have no personal liability for payment of the outstanding loan balance'; 'The mortgagee shall enforce the debt only through sale of the property'; 'shall not be permitted to obtain a deficiency judgment') and (c) ('if a borrower dies and the property is not the principal residence of at least one surviving borrower'; 'if a borrower conveys all of his or her title'; 'ceases to be the principal residence of a borrower for reasons other than death'; 'For a period of longer than 12 consecutive months'; 'because of physical or mental illness'; 'The borrower does not provide for the payment of property charges'; 'An obligation of the borrower under the mortgage is not performed') · Checked October 17, 2026

15. Under HUD's regulation (24 CFR §206.205), property taxes (including special assessments), homeowners insurance and flood insurance premiums are the borrower's obligations and are paid through a set-aside from the loan (LESA), by the borrower or by the lender; based on the financial assessment, the lender may require that set-aside; and the borrower must also pay ground rents, condominium fees and homeowners' association fees on time.

    Sources 15 · 24 CFR §206.205(a)(1) ('ground rents, condominium fees, planned unit development fees, and homeowners' association fees'), (a)(2) ('property taxes, including any special assessments levied by local or State law, hazard insurance premiums, and applicable flood insurance premiums'; 'shall be made through the LESA, by the borrower, or by the mortgagee') and (b)(1) ('based on the results of the Financial Assessment, the mortgagee may require the borrower to have a Fully-Funded LESA') · Checked October 17, 2026

16. Under HUD's regulation (24 CFR §206.55), if the last borrower dies before an eligible non-borrowing spouse, the loan's due date is deferred while that spouse keeps meeting the conditions: married to the borrower at closing and for the rest of the borrower's life; disclosed to the lender and named as an eligible non-borrowing spouse in the loan documents; and living, and continuing to live, in the home as their principal residence; in addition, within 90 days of the last borrower's death they must establish legal ownership or another legal right to remain for life, and keep meeting the loan's obligations; a spouse who did not qualify at closing cannot become eligible later.

    Sources 14 · 24 CFR §206.55(a) ('the due and payable status will be deferred'), (c)(1) ('Have been the spouse of a HECM borrower at the time of loan closing and remained the spouse of such HECM borrower for the duration of the HECM borrower's lifetime'; 'specifically named as an Eligible Non-Borrowing Spouse in the HECM mortgage and loan documents'; 'Have occupied, and continue to occupy, the property securing the HECM as his or her principal residence'), (c)(2) ('is not subsequently eligible for a Deferral Period') and (d) ('Within 90 days from the death of the last surviving HECM borrower, establish legal ownership or other ongoing legal right to remain for life') · Checked October 17, 2026

17. According to the CFPB, a HECM requires you to stay current on property taxes and homeowners insurance, and failing to pay either may lead to foreclosure; if you are struggling to pay them, look for help right away: there may be state and local programs, Area Agencies on Aging generally have information and can be found at (800) 677-1116, and a reverse mortgage housing counselor can help you find options.

    Sources 7 · What should I do if I have a reverse mortgage loan and I can't pay my property taxes or homeowners insurance? (reviewed July 11, 2022): 'look for help right away'; 'require that you keep current on your property taxes and homeowners insurance'; 'Failure to pay either may lead to foreclosure'; 'There might be state and local programs that can help you keep your home'; 'To find the nearest Area Agency on Aging call (800) 677-1116'; 'A reverse mortgage housing counselor can also help you find the best option for your situation' · Checked October 17, 2026

18. According to the CFPB, using a reverse mortgage to consolidate debt can be risky: you replace one debt with a riskier and perhaps more expensive one, your home equity falls and may not be there when you are older; and if you don't meet the loan's obligations, such as paying taxes and insurance, you may lose your home to foreclosure. It suggests talking with a nonprofit credit counselor or a HUD-approved housing counseling agency.

    Sources 8 · Should I use a reverse mortgage to consolidate my debts? (reviewed June 27, 2023): 'Using a reverse mortgage loan to consolidate debt can be risky'; 'replaces one kind of debt for another riskier and perhaps more expensive debt'; 'you may lose your home to foreclosure'; 'the equity you have in your home declines, meaning that it may not be available when you're older'; 'a nonprofit credit counselor can help you weigh your financial options'; 'You can also talk with a HUD-approved housing counseling agency' · Checked October 17, 2026