Reverse mortgages: what homeowners 62 and older should know

Learn how a reverse mortgage works, who qualifies, what it costs, and where it fits in retirement planning. A plain-English guide from your loan officer.

Kevin Kelly, Senior Mortgage Advisor

Progress Lending, LLC

Phone: (602) 780-2939

Email: [email protected]

NMLS# 245238

Company NMLS# 2326329

Licensed in: AZ, CA

This advertisement does not constitute a loan approval or loan commitment. Loan Approval and/or loan commitment is subject to final underwriting review and approval. Terms subject to change. Equal Housing Lender.

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Reverse mortgages: what homeowners 62 and older should know

November 10, 2026

For many homeowners over 62, the biggest asset they own is the house they have lived in for decades. A reverse mortgage lets them tap that equity without a required monthly principal and interest payment, which can take pressure off a fixed retirement budget. It also comes with real obligations, and the people who do well with it are the ones who understand those rules before they sign. Here is how I walk clients through the product.

A reverse mortgage pays you out of your home equity instead of asking you to pay into it. Most loans in this category are Home Equity Conversion Mortgages, which are insured by the Federal Housing Administration. You can usually take the money as a lump sum, as monthly payments, as a line of credit, or as a mix of those options. Interest and fees are added to the balance over time, so the amount owed grows while you live in the home. The loan generally comes due when the last borrower sells the house, moves out for good, or passes away.

Eligibility rules are specific, and they are the first thing I check. The home has to be your primary residence, at least one borrower generally needs to be 62 or older, and you need enough equity to make the loan work. Before applying, you must complete a counseling session with a HUD-approved counselor, which is designed to make sure the terms are clear. You also stay responsible for property taxes, homeowners insurance, and keeping the home in reasonable repair. The loan is non-recourse, so neither you nor your heirs will owe more than the home is worth when the loan is repaid.

I'd say a reverse mortgage fits best for someone who plans to stay in the home long term, needs more flexible cash flow, and can comfortably cover taxes and insurance. It is a harder fit for someone who expects to move within a few years, or who is already behind on property taxes or insurance. If you are married, the rules for a non-borrowing spouse deserve a close look, because they affect what happens when one spouse passes away. Heirs also have options when the loan comes due, including paying off the balance, selling the home, or refinancing, so families should talk about those choices early.

A reverse mortgage can be a useful tool for the right homeowner, but it is not a one-size-fits-all solution. Understanding the costs, obligations, and long-term effects on your estate makes the decision much clearer.