Reverse Mortgages. Equity, Without the Payment.
A HECM is an FHA-insured reverse mortgage for homeowners age 62 and older. It converts your home equity to cash (lump sum, line of credit, or monthly payments) with no required monthly mortgage payment.
- Age 62+ required
- FHA-insured (HECM)
- No monthly payment required
What a Reverse Mortgage Actually Is
A reverse mortgage is a federally insured loan against your home equity, designed specifically for older homeowners. You retain ownership and don't make monthly mortgage payments. The loan compounds and is repaid when you sell, move, or pass away.
- Borrower must be age 62 or older
- Home must be your primary residence
- You keep ownership and the title
- No monthly mortgage payment required
- You continue to pay property tax, insurance, and HOA dues
- FHA-insured: heirs never owe more than the home is worth
Reverse mortgages are a specialty product, not for everyone. Done well, they unlock decades of trapped equity for retirement income or healthcare without forcing a sale of the home. Done poorly, they can compound aggressively and leave heirs with a tighter timeline. The FHA insurance protects you and your family from the worst-case math, but the right structure still matters.
How You Receive the Money
Four payout structures, and you can mix them. Pick what fits your retirement plan and cash-flow needs.
Lump Sum or Line of Credit
- Lump sum: one disbursement at closing (fixed rate)
- Line of credit: draw what you need, when you need it (adjustable rate)
- Unused line-of-credit balance grows over time, a hedge against future home-value drops
- Best for: large one-time needs, or holding capacity for future expenses
Monthly Income
- Tenure: equal monthly payments as long as you live in the home
- Term: equal monthly payments for a set number of years
- Treats the home equity like a private pension
- Best for: supplementing Social Security or a fixed pension
Frequently Asked Questions
Do I still own my home with a reverse mortgage?
Yes. A reverse mortgage is a loan against your home equity, not a sale. You keep the title, you keep the home. You continue to pay property taxes, homeowner's insurance, and HOA dues, and keep the home in reasonable condition, the same obligations you'd have without the loan.
What happens to the loan when I pass away?
The loan becomes due. Your heirs have several options: pay off the loan and keep the home (typically by refinancing into a conventional loan), sell the home and keep any equity above the loan balance, or sign the home over to the lender if they don't want to keep it. The FHA insurance means heirs are never on the hook for more than the home is worth, even if the loan balance exceeds the home's value at the time.
How is the payout structured?
Four options. (1) Lump sum: one disbursement at closing. (2) Tenure: equal monthly payments for as long as you live in the home. (3) Term: equal monthly payments for a set number of years. (4) Line of credit: draw what you need, when you need it, with the unused portion growing over time. You can also mix options. We model the trade-offs for your goals.
Will Social Security or Medicare be affected?
No. Reverse mortgage proceeds are loan proceeds, not income. They don't affect Social Security or Medicare. Need-based programs like Medicaid or SSI can be affected if you take a lump sum and the cash sits in your account too long. We coordinate with your accountant or elder-law attorney if that's a concern.
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