30-yr fixed6.75%+0.0315-yr fixed6.05%+0.00FHA 30-yr6.55%+0.08VA 30-yr6.38%+0.08Jumbo 30-yr6.82%+0.11Updated September 1, 2026
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Loan type

Reverse mortgage

A reverse mortgage lets homeowners 62 and older convert home equity into cash without a monthly mortgage payment. The loan is repaid when the last borrower leaves the home. This is a serious financial decision that affects your heirs.

Talk to a HUD-approved counselor first

Who this is for

  • Homeowners 62 or older (55 in some proprietary programs)
  • Owners with substantial equity who plan to stay in the home
  • People who have talked it through with family and a HUD-approved counselor, which is required

How it works, step by step

  1. The most common type is the FHA-insured HECM. Counseling with a HUD-approved counselor is mandatory before you apply.
  2. Proceeds depend on age, home value and current rates. Younger borrowers get less.
  3. You still pay property taxes, insurance and maintenance. Falling behind can trigger foreclosure.
  4. Compare closing costs carefully. Up-front mortgage insurance and origination fees are significant.

Pros

  • No monthly principal and interest payment
  • Non-recourse: you or your heirs never owe more than the home is worth
  • Proceeds are loan advances, not income

Cons

  • Equity shrinks every year as interest accrues
  • High up-front costs
  • Heirs must repay or sell to keep the home
  • Taxes, insurance and upkeep remain your obligation