Who actually qualifies for a reverse mortgage?

✓ Accepted answer

You must be at least 59 years old, own your home outright or have significant equity, and maintain good standing on property taxes and insurance to qualify for a reverse mortgage.

• Age Requirement: The borrower must be at least 59 years old at closing. This minimum age is set by the Federal Housing Finance Agency, which guarantees loans backed by the Department of Housing and Urban Development. If your sister is 62, she meets this threshold, but she does not need to wait until 65 as is common in standard retirement planning.
• Home Ownership and Equity: You must own the property outright or have a low remaining balance on your existing mortgage. The lender requires enough equity to cover the new loan and fees. Typically, borrowers need at least 50% equity, though some options allow less depending on credit and interest rates.
• Financial Counseling: The Federal Housing Finance Agency mandates a one-hour counseling session before closing. A HUD-approved counselor reviews your options, including selling the home or finding family support. You must keep this certificate for three years after the loan is issued.
• Property Maintenance and Taxes: You are responsible for paying property taxes, maintaining homeowner's insurance, and keeping the house in good condition. Lenders may perform periodic inspections to ensure the property is not deteriorating.
• Occupancy Rules: You must use the home as your primary residence. If you move into assisted living, hospice, or a long-term care facility for more than 12 months, the loan may be called due. This is a critical risk you must plan for, as the balance is repaid when you sell the home or permanently leave it.

admin · 2026-10-03 05:57:24