Reverse Mortgage Frequently Asked Questions

Yes. You keep the title and remain the homeowner. The lender places a lien on the property, just as with most mortgages. You are responsible for property taxes, homeowners insurance, and maintaining the home.

Generally, borrowers must be 55 or older, live in the home as a primary residence, have sufficient equity, complete HUD-approved counseling (for a HECM), and demonstrate the ability to pay taxes, insurance, and upkeep. The home must also meet applicable property standards.

Available funds — often called the principal limit — depend mainly on the youngest borrower’s age, the home’s appraised value (subject to lending limits), current interest rates, and any existing mortgage that must be paid off. Older borrowers with more equity typically qualify for a higher percentage of value.

Common options include a lump sum, monthly tenure payments, a line of credit, or a combination. On many HECM lines of credit, unused credit may grow over time, increasing future availability.

Reverse mortgage proceeds are generally not treated as taxable income. Tax rules can vary by situation — consult your tax advisor for guidance specific to you.

Typically no. Social Security and Medicare are not usually affected by reverse mortgage proceeds. Need-based programs such as Medicaid may consider assets differently, so speak with a benefits specialist if relevant.

The loan becomes due. Heirs often have a period of time to repay — commonly by selling the home, refinancing, or using other funds. Any equity remaining after the loan is satisfied belongs to the estate. HECM loans are non-recourse, so heirs generally are not personally liable beyond the home’s value.

Before closing a HECM, you complete a session with an independent HUD-approved counselor. The counselor explains how the loan works, costs, obligations, and alternatives so you can decide with clear information — separate from the lender’s sales process.

Many reverse mortgages close in about 30 to 60 days, though timing varies with counseling, appraisal, documentation, and underwriting. Ann can outline a realistic timeline for your situation.

Yes. You may make voluntary payments or pay the loan in full at any time. There is typically no prepayment penalty on a HECM.

No. It can be a strong fit for homeowners who want to stay in their home, improve cash flow, or access equity without a new monthly mortgage payment. It may be less suitable if you plan to move soon or want to maximize inheritance. Ann can help you weigh the trade-offs for your goals.