What is an FHA Reverse Mortgage?

An FHA Reverse Mortgage allows homeowners to exchange some of their equity for cash. Each month the homeowner receives a check from the lender. Unlike a home equity loan, a Reverse Mortgage does not require the homeowner to make any payments. The lender is paid back when the home sells.

Who is an FHA Reverse Mortgage For?

FHA Reverse Mortgages are designed specifically for older homeowners who have significant equity but little cash. To qualify for an FHA Reverse Mortgage, applicants must be at least 62-years-old, own their properties outright or have a low balance on their loan, and live in the home.

How Does an FHA Reverse Mortgage Work?

FHA Reverse Mortgages do not require that homeowners demonstrate any income. Applicants are accepted based on their age and the amount of equity in their home. Each month, the homeowner receives a check for the agreed-upon amount. The borrower never has to repay the loan for as long as he/she lives in the home.

The lender is repaid when the borrower (or his estate) sells the property. The borrower or his/her heirs receive any remaining equity.

Learn More

More information about FHA loans can be found here: FHA Mortgage Basics.