how it works

As a starting point, reverse mortgages are exclusively available to homeowners 55 and older, though some states or product types require you to be 60 or 62. Speaking with an experienced loan officer can help determine if a reverse mortgage is a sensible and available option for you. 

Speaking with an experienced loan officer is the best way to get concrete numbers that reflect your individual situation. The amount you may qualify for is highly dependent on several variables, including: 

• Your age
• The state you live in 
• Current interest rates
• Your home's value
• The reverse product and disbursement option you choose

For most products, you have the ability to access your home equity in the ay that makes the most sense for your financial needs. Options include receiving a lump sum upfront, setting up monthly disbursements, establishing a line of credit - or a combination of all three. 

Typically, a reverse mortgage ends when you no longer use the home as your primary residence. This could be due to several factors, including a permanent move, selling the home, or the last borrower passing away. At this time, the balance must be repaid. 

It's important to remember that reverse mortgages are non-recourse loans, which means that you, or your estate, can't owe more than the value of your home when the loan becomes due and the home is sold. 

Closing costs for a reverse mortgage are near-identical to what you would expect to pay when obtaining a traditional forward mortgage. Most of the costs can be financed into the loan, so there is a minimal out-of-pocket upfront cost. Here's what you can typically expect to see: 

Similar to what you'd expect with a forward mortgage: 

• Appraisal (usually paid in advance) 
• Title services and title insurance
• Credit report
• Property inspection (not always required)
• Origination fee (if applicable) 
• State and local taxes, and tax verification fee
• Government recording fees

Unique to reverse mortgage: 

• Reverse counseling (paid in advance) 
• FHA insurance (only for HECM loans)