REVERSE MORTGAGE HELP CENTER
Reverse Mortgage FAQ
Clear Answers to Common Reverse Mortgage Questions
Reverse mortgages can be confusing—especially when information from friends, advertisements, and online sources doesn’t always agree.
At Platinum Lending Solutions, we believe homeowners should understand how a reverse mortgage works before deciding whether one belongs in their retirement plan.
Below you’ll find answers to some of the most common questions we hear from homeowners throughout Oregon and Washington.
For more detailed information about a specific topic, you can also explore the related reverse mortgage guides throughout this resource center.
Find the Topic You’re Looking For
Start with a category below, then open the questions that matter most to you.
Reverse Mortgage Basics
Start here if you’re learning about reverse mortgages for the first time.
What is a reverse mortgage?
A reverse mortgage is a specialized home loan that allows eligible older homeowners to access a portion of their home equity while continuing to own and live in their home.
Unlike a traditional mortgage, there are generally no required monthly principal and interest payments as long as the borrower continues to meet the loan requirements.
The most common reverse mortgage is the federally insured Home Equity Conversion Mortgage, or HECM.
How does a reverse mortgage work?
A reverse mortgage converts a portion of your home equity into loan proceeds.
Depending on the program and loan structure, proceeds may be available through a lump sum, monthly advances, a line of credit, or a combination of available options.
Instead of making required monthly principal and interest payments, interest and applicable charges are added to the outstanding loan balance.
The loan generally becomes due following a maturity event, such as when the last borrower sells the home, permanently moves out, or passes away.
How old do I have to be for a reverse mortgage?
For an FHA-insured HECM, borrowers generally must be at least 62 years old.
Some proprietary reverse mortgage programs may have different age requirements depending on the lender, program, and state.
Do I need to own my home free and clear?
No.
Many homeowners obtain a reverse mortgage while they still have an existing mortgage.
The existing mortgage generally must be paid off at closing using proceeds from the reverse mortgage. Any remaining proceeds may then be available according to the loan terms.
Whether this works depends largely on your home’s value, existing mortgage balance, age, interest rates, and applicable program guidelines.
Home Ownership & Monthly Payments
Understand what changes—and what doesn’t—after obtaining a reverse mortgage.
Do I still own my home with a reverse mortgage?
Yes.
You continue to own your home and retain title.
The reverse mortgage is a lien against the property, similar in that respect to a traditional mortgage.
The lender does not become the owner of your home.
Will I have a monthly mortgage payment?
A reverse mortgage generally does not require monthly principal and interest payments as long as you continue to meet the loan obligations.
You remain responsible for applicable property expenses, including property taxes, homeowners insurance, HOA dues when applicable, and home maintenance.
You must also continue meeting the applicable occupancy requirements.
Can I make payments if I want to?
Yes.
Although monthly principal and interest payments aren’t required, borrowers may generally make voluntary payments toward the loan balance without a prepayment penalty, subject to the specific loan terms.
Can I lose my home with a reverse mortgage?
A reverse mortgage does not eliminate your responsibilities as a homeowner.
If you fail to pay property taxes, maintain required homeowners insurance, maintain the property, or meet applicable occupancy requirements, the loan could become due and payable and potentially lead to foreclosure.
Understanding these responsibilities before taking out a reverse mortgage is essential.
Reverse Mortgage Proceeds
How much may be available and how can the funds be accessed?
How much money can I receive from a reverse mortgage?
There isn’t one standard percentage.
The amount available depends on factors including the age of the youngest borrower or eligible non-borrowing spouse when applicable, home value, current interest rates, existing mortgage balance, applicable FHA limits for a HECM, and the loan program selected.
A personalized reverse mortgage illustration can help estimate how much may be available for your situation.
How can I receive my reverse mortgage proceeds?
Depending on your loan program, proceeds may be available through a lump sum, monthly advances, a line of credit, or a combination of available options.
Not every payment option is available with every reverse mortgage structure.
Can I use reverse mortgage money for anything I want?
After required mortgage balances and other applicable obligations are satisfied, remaining proceeds can generally be used for purposes you choose.
Depending on the program and your goals, proceeds may be used for a wide range of purposes.
Are reverse mortgage proceeds taxable?
Reverse mortgage proceeds are generally considered loan advances rather than taxable income.
However, individual circumstances vary. Consult your tax professional regarding your specific situation.
Will a reverse mortgage affect my Social Security or Medicare?
Reverse mortgage proceeds generally do not affect Social Security retirement benefits or Medicare.
However, needs-based programs such as Medicaid and Supplemental Security Income can have asset and eligibility requirements.
If you receive needs-based benefits, consult an appropriate financial, tax, or benefits professional before accessing proceeds.
Reverse Mortgage Line of Credit
The HECM line of credit works differently from a traditional home equity line of credit.
What is a reverse mortgage line of credit?
An adjustable-rate HECM may allow eligible borrowers to place available proceeds into a line of credit.
You can then access those funds when needed rather than taking all available proceeds immediately.
There are generally no required monthly principal and interest payments on funds borrowed as long as the loan requirements continue to be met.
Does a reverse mortgage line of credit grow?
An unused HECM line of credit has a growth feature that can increase available borrowing capacity over time according to the terms of the loan.
This does not mean the money is earning interest.
A HECM line of credit is not a savings or investment account. Instead, the amount available for future borrowing may increase according to the program’s calculation.
Is a reverse mortgage line of credit the same as a HELOC?
No.
Both allow homeowners to access home equity, but they operate differently.
A HELOC generally requires monthly payments and uses traditional credit and income qualification.
A HECM line of credit generally does not require monthly principal and interest payments and includes features specifically designed for eligible older homeowners.
Costs & Interest
Reverse mortgages are loans, so costs and interest are important parts of the decision.
What does a reverse mortgage cost?
Reverse mortgage costs may include origination charges, appraisal, title and settlement costs, recording fees, interest, FHA mortgage insurance for HECMs, and other applicable third-party expenses.
Many eligible closing costs can typically be financed into the loan rather than paid entirely out of pocket.
Do I pay interest on a reverse mortgage?
Yes.
A reverse mortgage is a loan.
Interest accrues on the outstanding loan balance and is generally added to that balance rather than requiring you to pay the interest each month.
As the loan balance grows, your remaining home equity may decrease depending on future home appreciation and other factors.
Is a reverse mortgage free money?
No.
Reverse mortgage proceeds are borrowed against your home equity and eventually must be repaid.
The absence of required monthly principal and interest payments should not be confused with the absence of borrowing costs.
Qualification & Property Requirements
Qualification is different from a traditional mortgage because the loan itself generally has no required monthly principal and interest payment.
Does my credit score matter?
A HECM does not rely on a single universal minimum credit score in the same way many traditional mortgage programs do.
However, lenders conduct a financial assessment that includes reviewing your credit and payment history, income, assets, and ability to meet ongoing property obligations.
Do I need income to qualify?
Lenders conduct a financial assessment to determine whether you can reasonably meet ongoing obligations such as property taxes and homeowners insurance.
The qualification process differs from a traditional mortgage because there are no required monthly principal and interest payments.
What types of homes qualify?
Depending on applicable program requirements, eligible properties may include single-family homes, certain condominiums, certain manufactured homes, and two- to four-unit properties when the borrower occupies one unit.
The property generally must be the borrower’s primary residence for a HECM.
Can I get a reverse mortgage on an investment property?
A HECM is intended for a primary residence and generally cannot be used for an investment property or vacation home.
Other financing solutions may be available if you want to access equity from an investment property.
Spouses, Children & Heirs
Questions about family and inheritance are an important part of reverse mortgage planning.
What happens to my reverse mortgage when I die?
When the last borrower passes away, the reverse mortgage generally becomes due and payable, subject to applicable program provisions.
Heirs then have options based on the property, loan balance, and program requirements.
Can my children inherit my home?
Yes.
A reverse mortgage does not prevent you from leaving your home to your heirs.
Your heirs may generally choose to sell the property and repay the loan or satisfy the loan according to applicable requirements if they want to keep the home.
Any remaining equity after repayment belongs to the estate.
Will my children personally owe my reverse mortgage?
HECM reverse mortgages include non-recourse protection.
Generally, neither borrowers nor their estates are responsible for more than the value of the property under applicable HECM repayment rules.
Your heirs are not simply responsible for paying a shortage from their personal assets if the loan balance exceeds the home’s value.
What if my spouse is younger than 62?
Special rules may apply when one spouse is younger than 62.
Depending on the circumstances, a younger spouse may potentially qualify as an eligible non-borrowing spouse and receive certain protections.
Because the details are important, both spouses should understand exactly how the loan would affect them before proceeding.
Selling, Moving & Buying Another Home
Having a reverse mortgage does not mean you are permanently tied to the property.
Can I sell my home if I have a reverse mortgage?
Yes.
You may sell the home whenever you choose.
The reverse mortgage balance is generally repaid from the sale proceeds, and the remaining equity belongs to you.
What happens if I move?
A HECM is designed for your primary residence.
If the property permanently stops being your primary residence, the loan may become due and payable according to program requirements.
Can I use a reverse mortgage to buy another home?
Yes.
The HECM for Purchase program allows eligible buyers age 62 and older to purchase a primary residence using a combination of their own funds and reverse mortgage financing.
This can allow buyers to preserve more of their available cash while avoiding required monthly principal and interest payments.
HECM vs. Jumbo Reverse Mortgages
Different reverse mortgage programs can serve different types of homeowners and properties.
What is a HECM?
A Home Equity Conversion Mortgage, or HECM, is a federally insured reverse mortgage backed by the Federal Housing Administration.
It is the most widely used reverse mortgage program in the United States.
What is a jumbo reverse mortgage?
A jumbo reverse mortgage, also called a proprietary reverse mortgage, is a privately funded reverse mortgage.
These programs can be particularly useful for higher-value properties because they may provide borrowing capacity beyond what is available through a HECM.
Which is better: a HECM or jumbo reverse mortgage?
Neither is automatically better.
Choosing a suitable option depends on your age, property value, desired proceeds, costs, available features, and financial goals.
As an independent mortgage broker, Platinum Lending Solutions can compare available HECM and proprietary options rather than limiting you to a single reverse mortgage product.
Reverse Mortgages in Oregon & Washington
Are reverse mortgages available in Oregon?
Yes.
Eligible Oregon homeowners can obtain HECM and available proprietary reverse mortgage programs, subject to borrower, property, lender, and program requirements.
Platinum Lending Solutions works with homeowners throughout Oregon.
Are reverse mortgages available in Washington?
Yes.
Eligible Washington homeowners can also access HECM and available proprietary reverse mortgage programs.
Platinum Lending Solutions serves homeowners throughout Washington.
Are Oregon and Washington reverse mortgage requirements different?
HECM loans follow federal FHA requirements nationwide, although state laws and local property-related requirements can affect aspects of a transaction.
Proprietary reverse mortgage availability and guidelines may also vary by lender and state.
We’ll review the requirements that apply to your specific property and loan program.
Is a Reverse Mortgage Right for Me?
There isn’t a universal answer.
A reverse mortgage should be evaluated as part of your broader homeownership and retirement strategy.
It May Be Worth Considering If You:
• Are an eligible older homeowner
• Have substantial home equity
• Want to eliminate an existing mortgage payment
• Want greater retirement liquidity
• Plan to remain in your home
• Want access to home equity without selling
• Want a financial resource for future needs
It may not be appropriate if you plan to move soon, do not have sufficient equity, cannot maintain ongoing property expenses, or have other financial priorities better served by another strategy.
Still Have Questions?
This FAQ provides a broad overview, but your home, finances, and retirement goals are unique.
We’ll explain how a reverse mortgage works, review potential benefits, costs, responsibilities, and alternatives, and compare available programs in plain language.
As an independent mortgage broker serving Oregon and Washington, Platinum Lending Solutions can help you evaluate HECM, proprietary reverse mortgage, and traditional financing options based on your individual circumstances.
