A type of loan that allows senior homeowners to borrow against the equity in their homes. Also like a traditional mortgage, when you take out a reverse mortgage loan, the title to your home remains in your name. However, unlike a traditional mortgage, with a reverse mortgage loan, borrowers don’t make monthly mortgage payments. The borrower is still responsible for paying their property taxes and insurance and maintaining the home.

A Home Equity Conversion Mortgage (HECM) is a federally insured reverse mortgage program, regulated by the U.S. Department of Housing and Urban Development (HUD). Borrowers are responsible for paying the premiums of that insurance.  A HECM is the most common type of reverse mortgage and offers several safeguards for eligible homeowners. 

To qualify for a HECM reverse mortgage, you must be at least 62 years old, own your home outright or have a low mortgage balance, and live in the home as your primary residence. Your eligibility will also be determined by a financial assessment to ensure you can meet ongoing obligations like property taxes and insurance.

The amount of equity required for a reverse mortgage varies based on factors such as your age, the home’s appraised value, and current interest rates. Generally, the older you are and the higher your home’s value, the more equity you can access.