Reverse mortgages, in plain English
Quick Answer
A reverse mortgage lets homeowners 62 and older borrow against their home's value with no monthly mortgage payment. You keep living there and keep paying property taxes, insurance and upkeep. Interest and fees are added to the balance, which is repaid when the last borrower dies or moves out, usually by selling the home.
The most common kind is the Home Equity Conversion Mortgage, or HECM, which is insured by the FHA. The youngest borrower must be at least 62 at closing. Before you apply, you meet with a HUD-approved counselor.
You never owe more than your home is worth. If the balance grows larger than the home's value, FHA mortgage insurance covers the difference, so neither you nor your heirs pay it out of pocket.
Moving? A HECM for Purchase lets you buy your next home with a reverse mortgage in one closing, putting in the rest of the price yourself.
A reverse mortgage uses up equity you might otherwise leave to your family, and it costs more to set up than most loans.
Guides
- Can you buy a home with a reverse mortgage?How HUD's HECM for Purchase works: who can use it, how much you put in, which homes are eligible and the rule to move in within 60 days.
- What does a reverse mortgage cost?HECM reverse mortgage costs explained: FHA mortgage insurance, the origination fee cap, servicing fees, closing costs and interest.
- What happens at HUD reverse mortgage counseling?Why HUD counseling is required before a HECM, how to find a HUD-approved counselor, what it costs and how long your certificate lasts.
- How much can you get from a reverse mortgage?What sets the amount you can borrow with a HECM reverse mortgage: age, home value, the 2026 HUD limit, the expected rate and the first-year limit.
- What happens to a reverse mortgage when the borrower dies?What heirs and surviving spouses need to know when a reverse mortgage borrower dies: deadlines, options, and why you never owe more than the home is worth.
Run your own numbers with the reverse mortgage calculator, or see every question we answer about reverse mortgages.
Common Questions
Is a reverse mortgage free money?
No. The CFPB says that a reverse mortgage is not free money. It's a loan: interest and fees are added each month, and it's repaid when you leave the home.
Does the VA offer reverse mortgages?
No. The CFPB warns that the Department of Veterans Affairs does not offer any reverse mortgage loans, so be wary of ads that suggest otherwise.
Do I have to live in the home?
Yes. The home must be your principal residence, meaning you live there most of the year. Moving out is one of the things that can make the loan come due.