A reverse mortgage is designed for homeowners age 62 and older and may allow you to access home equity without monthly mortgage payments. Funds can be received as a lump sum, line of credit, or monthly payments. It can help support retirement income, cover expenses, and let you stay in your home with confidence.
A reverse mortgage is a home loan for homeowners age 62 and older that lets you access home equity without monthly mortgage payments. Funds may be received as a lump sum, line of credit, or monthly payments. The loan is typically repaid when you sell the home, move out, or the last borrower passes away.
Homeowners age 62 and older who want to supplement retirement income, reduce monthly expenses, or access home equity without selling their home may benefit from a reverse mortgage. It can be helpful for seniors who plan to stay long term, have significant equity, and want flexible cash options for living costs, medical bills, or home improvements.
A reverse mortgage works by converting part of your home equity into cash while you continue to own and live in your home. Instead of making monthly mortgage payments, interest is added to the loan balance over time. The loan is repaid when you sell the home, move out permanently, or when the last borrower passes away.
The most common reverse mortgage is the HECM, or Home Equity Conversion Mortgage, which is insured by the FHA and offers flexible payout options. Some lenders also offer proprietary reverse mortgages for higher value homes, and single purpose reverse mortgages from local agencies for specific needs like taxes or repairs.
A reverse mortgage may provide cash, generally not taxed as income,, eliminate monthly mortgage payments, and help homeowners age 62 and older stay in their home while accessing equity. It can improve cash flow, offer flexible payout options, and give seniors more financial freedom to cover living expenses, medical costs, or home improvements.
A reverse mortgage may be right for you if you are age 62 or older, have significant home equity, and plan to stay in your home long term. It can be a good option if you want to supplement retirement income, reduce monthly expenses, and access equity without selling, but it’s important to consider costs and long term goals.
Jon Shrum, President of KMC Financial and Team Shrum, offers clear, honest guidance for homeowners age 62 and older considering a reverse mortgage. He takes the time to explain how it works, your options, and the long term impact, so you can decide with confidence. With integrity at the core of his approach, Jon helps you access home equity in a way that supports your retirement goals and peace of mind.
A reverse mortgage decision should account for ongoing bills, occupancy and future housing needs. Discuss the details with the borrower, counselor and relevant advisers.
First identify whether the offer is an FHA-insured HECM or a proprietary product. HECMs generally require borrowers to be at least 62, along with counseling and financial and property eligibility. Different products should not be assumed to share those exact conditions or protections.
Existing liens generally need payoff at closing, and charges also affect the available amount. Age, rates and acceptable property value are among the factors in the calculation. Ask for the net result; a percentage of estimated equity does not establish eligibility or spendable proceeds.
The borrower must meet taxes, required insurance, maintenance and other loan obligations. The absence of a required monthly principal-and-interest payment does not transfer those bills to the lender. Failure to meet the conditions can lead to default or repayment becoming due.
Review a projection showing advances, interest and fees over the expected period in the home. Without voluntary payments, the balance generally increases. Consider the resulting equity available for a later move or estate alongside the benefit of accessing funds now.
Eligible non-borrowing spouse protections have specific requirements and limits. The counselor should explain the consequences of death, permanent relocation and occupancy changes. Other family members living in the property do not automatically have the same protections.
Certain absences or loss of principal-residence status can make a HECM due, subject to applicable borrower and spouse rules. Discuss potential care arrangements before closing. The mortgage should fit likely housing needs, not only the current living arrangement.
After a repayment event, contact the servicer about deadlines and options to sell, repay or refinance to retain the home. HECM nonrecourse protections apply under program rules. The outstanding lien still needs to be addressed; ownership does not pass free of the loan.
Yes. Advances generally are not taxable income, but retained proceeds can affect some means-tested benefits. Ask qualified advisers to review the specific circumstances and planned withdrawals. Avoid assuming that every way of drawing and holding funds has the same consequences.
Information checked September 6, 2026. Sources: CFPB: Reverse mortgage responsibilities · CFPB: Reverse mortgage terms · CFPB: Reverse mortgage costs · CFPB: Heirs and surviving household members · IRS: Tax treatment of reverse mortgage proceeds.
This material is not provided by, nor was it approved by, the Department of Housing and Urban Development (HUD) or the Federal Housing Administration (FHA). Team Shrum, KMC Financial and ARBOR Financial Group are not affiliated with any government agency. Reverse mortgage borrowers remain responsible for property taxes, homeowners insurance and home maintenance. Failing to meet these obligations can put the loan at risk.
