Unlock YourHome's ValueIn Retirement
Convert home equity into tax-free cash— without monthly mortgage payments.
Reverse mortgages aren't right for everyone. We'll help you understand the real costs, real risks, and whether it makes sense for your situation.
Watch & Understand
Educational videos from government agencies and non-profit organizations—not lenders trying to sell you something.
Video Playlist
5 educational videos
All videos from CFPB, HUD, AARP, and consumer protection sources
Mandatory Counseling
HUD requires counseling with an approved agency before you can get a HECM—protecting you from pressure tactics.
Federal Insurance
HECM loans are insured by the FHA, providing protections that proprietary reverse mortgages don't offer.
Beware of Scams
Never pay thousands for "free" information. HUD provides everything you need at no cost: 1-800-569-4287.
What Is a Reverse Mortgage?
A reverse mortgage is a special type of home loan available exclusively to homeowners aged 62 and older. Unlike traditional mortgages where you make monthly payments to the lender, a reverse mortgage allows you to convert a portion of your home equity into cash—without making monthly mortgage payments.
Traditional Mortgage
You make monthly payments to the lender. Your loan balance decreases over time as you pay it down.
Reverse Mortgage
The lender pays you. Your loan balance increases over time as interest accumulates.
You Stay in Your Home
You retain full ownership. The loan is repaid when you sell, move out, or pass away.
Key Things to Know
No monthly mortgage payments required
You must still pay property taxes, insurance, and maintenance
You retain home ownership
The bank does not own your home—you do
Non-recourse loan protection
You (or heirs) never owe more than the home's value
Loan balance grows over time
Interest compounds, reducing your remaining equity
HECM vs. Proprietary Reverse Mortgages
Most reverse mortgages are HECMs (Home Equity Conversion Mortgages), which are federally insured. Proprietary reverse mortgages are private loans for higher-value homes.
| Feature | HECM (FHA-Insured) | Proprietary |
|---|---|---|
| Federal Insurance | Yes (FHA) | No |
| Minimum Age | 62 years old | Varies (often 60-62) |
| Loan Limits | Up to $1,209,750 (2026) | $2M - $4M+ possible |
| Mandatory Counseling | Required (HUD) | Not required |
| Mortgage Insurance Premium | 2% upfront + 0.5% annual | None |
| Non-Recourse Protection | Guaranteed | Varies by lender |
| Payment Options | Lump sum, line of credit, monthly, combo | Lump sum or line of credit |
| Interest Rate Types | Fixed (lump sum) or adjustable | Usually adjustable |
| Property Types | 1-4 unit, condos, manufactured homes | More flexibility |
| Best For | Most borrowers (95%+) | High-value homes exceeding HECM limits |
Our Recommendation
For most borrowers, a HECM is the better choice due to federal insurance protections, mandatory counseling, and guaranteed non-recourse status. Only consider proprietary options if your home value significantly exceeds HECM limits and you understand the reduced protections.
How Reverse Mortgages Work
From application to funding, here's what to expect at each stage of the reverse mortgage process.
Counseling
Meet with HUD-approved counselor to understand options and responsibilities.
Application
Submit application with counseling certificate to FHA-approved lender.
Appraisal
FHA appraisal determines home value and identifies required repairs.
Underwriting
Financial assessment ensures you can pay taxes, insurance, and maintenance.
Closing & Funding
Sign documents, 3-day rescission period, then receive your funds.
Payment Options: How You Receive Your Money
Choose the option that best fits your financial needs
How Seniors Use Reverse Mortgage Funds
There are no restrictions on how you use your reverse mortgage proceeds. Here are the most common uses—along with honest considerations for each.
Home Repairs & Modifications
Roof replacement, HVAC systems, accessibility modifications like wheelchair ramps and stairlifts.
Get multiple quotes. Some contractors overcharge seniors.
Medical & Healthcare Costs
Prescriptions, surgeries, dental work, hearing aids, and medical equipment not covered by Medicare.
Large lump sums may affect Medicaid eligibility.
In-Home Care & Assistance
Hire caregivers, home health aides, or housekeeping help to age in place safely.
Care costs can escalate. Plan for increasing needs.
Supplement Retirement Income
Cover groceries, utilities, property taxes, and day-to-day expenses when Social Security falls short.
Monthly tenure payments may be better than lump sum.
Eliminate Existing Mortgage
Use reverse mortgage proceeds to pay off your current mortgage and eliminate monthly payments.
You're replacing one debt with another—understand the costs.
Delay Social Security Benefits
Use reverse mortgage funds to delay claiming Social Security, allowing benefits to grow 8% per year until age 70.
Complex strategy. Consult a financial advisor first.
Risks You Must Understand
We believe in complete honesty. Reverse mortgages aren't right for everyone, and these are the real concerns you need to consider before proceeding.
"Will the bank take my home?"
THE MYTH
Many people believe reverse mortgage lenders are trying to steal homes from seniors. This is the #1 misconception.
THE REALITY
You retain full ownership of your home. The bank has a lien (like any mortgage), but you own the property. You can sell at any time. Your heirs inherit the home and can keep it by paying off the loan, or sell it and keep any remaining equity.
FHA insurance guarantees you can never owe more than your home's value.
"Will my children be stuck with debt?"
THE FEAR
Parents worry their kids will inherit a mountain of debt or be forced to pay off the reverse mortgage from their own pockets.
THE REALITY
Reverse mortgages are "non-recourse" loans. Your heirs are never personally liable for the loan balance. They have options: pay off the loan and keep the home, sell the home and keep remaining equity, or simply turn over the keys with no financial obligation.
However, a reverse mortgage does reduce the inheritance you leave behind.
"Will fees eat all my equity?"
THE CONCERN
Reverse mortgages have higher fees than traditional mortgages. Upfront costs can reach $10,000-$20,000+, and interest compounds over time.
THE REALITY
This is a legitimate concern. Costs include origination fees (up to $6,000), mortgage insurance (2% upfront + 0.5% annually), closing costs, and compounding interest. The longer you hold the loan, the more interest accrues.
Best strategy: Use line of credit and only draw what you need to minimize interest.
"Can I still be foreclosed on?"
THE TRUTH
Yes. Even with no monthly mortgage payments, you CAN lose your home to foreclosure if you fail to meet your obligations.
YOUR RESPONSIBILITIES
- Fail to pay property taxes → foreclosure
- Fail to maintain homeowners insurance → foreclosure
- Fail to maintain the property → foreclosure
- Move out for 12+ months → loan becomes due
Is a Reverse Mortgage Right for You?
Answer honestly. A reverse mortgage may be a good fit if you check most boxes on the left, but may NOT be right if you check boxes on the right.
May Be a Good Fit
- Plan to stay in your home for 5+ years
- Can afford property taxes and insurance
- Have significant home equity
- Want to age in place
- Heirs understand and support the decision
- Need funds but don't qualify for other loans
May NOT Be Right
- Plan to move within 5 years
- Struggle to pay property taxes now
- Want to leave home to heirs debt-free
- Health may require nursing home soon
- Have other less expensive options available
- Feel pressured by family or salespeople
Our Honest Position
We believe reverse mortgages can be a valuable tool for the right homeowner—but we'd rather lose a deal than put you in the wrong product.
If you're considering a reverse mortgage because you're struggling to pay bills and have no other options, it might help. But if you're being pressured by a family member, contractor, or financial advisor who stands to benefit, that's a red flag.
The mandatory HUD counseling exists for a reason. Use it. Ask hard questions. Take your time. A good reverse mortgage decision is a slow, informed one—not a rushed one.
Consumer Rights & Protections
Federal law provides significant protections for reverse mortgage borrowers. Know your rights before signing anything.
3-Day Right to Cancel
After closing, you have 3 business days to cancel your reverse mortgage for any reason—no questions asked. This is your "rescission period."
- Written cancellation required
- No penalty for canceling
- All fees must be refunded
Required Disclosures
Lenders must provide clear, written disclosures about all costs, terms, and risks before you commit to anything.
- Total Annual Loan Cost (TALC)
- Good Faith Estimate of fees
- Loan comparison worksheet
Non-Recourse Guarantee
HECM loans are non-recourse, meaning you or your heirs can never owe more than the home's fair market value.
- FHA insurance covers the difference
- No personal liability for heirs
- Protected even if market crashes
Understanding HECM Costs
Transparency is essential. Here's what you can expect to pay for a HECM reverse mortgage:
| Fee Type | Amount | Notes |
|---|---|---|
| Origination Fee | $2,500 - $6,000 | 2% of first $200K + 1% of remainder, capped at $6,000 |
| Upfront MIP (FHA Insurance) | 2% of home value | Mortgage Insurance Premium paid at closing |
| Annual MIP | 0.5% per year | Added to loan balance annually |
| Closing Costs | $2,000 - $5,000 | Appraisal, title insurance, recording fees, etc. |
| HUD Counseling | $0 - $125 | Required; many agencies offer free counseling |
| Servicing Fee | $0 - $35/month | Monthly fee added to loan balance (many lenders: $0) |
Important: Most fees can be financed into the loan (you don't pay cash upfront), but they reduce your available proceeds and accrue interest over time.
Frequently Asked Questions
Get answers to the most common reverse mortgage questions. Still have questions? Call us or schedule a consultation.
Eligibility & Getting Started
How Reverse Mortgages Work
Family & Inheritance
Costs & Risks
Start with Free HUD Counseling
Before talking to any lender, get independent guidance from a HUD-approved counselor. It's required anyway—and it's the best way to protect yourself.
Is a Reverse Mortgage Right for You?
This isn't a decision to rush. We'll walk you through the numbers, explain exactly what you're giving up, and connect you with a HUD-approved counselor—even if it means you decide it's not right for you.
A reverse mortgage is a major financial decision. We'd rather you make the right choice than a quick one.
Exploring a reverse mortgage as an Arizona homeowner? See Arizona reverse mortgage details
Licensed in: Arizona | Equal Housing Lender