The five requirements
- Age 62 or older — the youngest borrower on title. Not an average, not the older spouse. A younger spouse can still be protected as an eligible non-borrowing spouse, covered below.
- It is your principal residence. You live there the majority of the year. Second homes and rentals do not qualify for a HECM.
- Sufficient equity. There is no fixed percentage. The test is whether the principal limit covers your existing mortgage plus closing costs. In today's rates that usually means roughly 50% equity at 62, less as you get older.
- An eligible property type. Single-family, 2–4 units where you occupy one, FHA-approved condominiums, and most manufactured homes that meet FHA standards.
- You pass the financial assessment — not a credit score test. See below.
You do not need to own it free and clear
The most common reason people never call. An existing mortgage is paid off at closing out of the proceeds — that is what most borrowers use a reverse mortgage for. You need enough equity to cover the payoff, not a clear deed.
The financial assessment, in plain terms
Since 2015, HUD has required lenders to check that a borrower can realistically keep paying property taxes and homeowners insurance. It is not a credit score cutoff and it is not a debt-to-income ratio. There is no minimum FICO on a HECM.
What is actually reviewed:
- Property charge history. Have taxes and insurance been paid on time, generally over the last two years? This carries the most weight by a wide margin.
- Credit history as a pattern, not a number. Late payments are looked at in context. A bankruptcy or foreclosure with a documented explanation is frequently fine.
- Residual income. Whether enough is left each month, after normal expenses, to run the household. Regional thresholds, and the payment you are eliminating counts in your favour.
If the assessment goes against you
It usually is not a decline. It is a LESA — a Life Expectancy Set Aside. A portion of your principal limit is reserved to pay property taxes and insurance for as long as the loan runs, and the servicer pays them for you. You receive less cash. In exchange, the single largest cause of reverse mortgage foreclosure is removed from your life entirely.
Plenty of borrowers who could avoid a LESA choose one anyway. It is not a punishment.
What quietly disqualifies a property
- A condo in a non-FHA-approved project. The most common surprise. Single-unit approval exists and can sometimes be obtained during the file, but it adds time and is not guaranteed. Worth checking before an appraisal is ordered.
- A manufactured home that misses FHA standards. It must be built after June 1976, be permanently affixed to a foundation, be titled as real property rather than a vehicle, and sit on land you own.
- Deferred maintenance the appraiser flags. A roof at the end of its life, a failing septic, peeling paint on a pre-1978 home. Required repairs can sometimes be completed after closing out of a repair set-aside, if they are under a threshold.
If your spouse is under 62
This is the detail that has to be handled correctly at application, because it cannot be fixed afterwards.
A spouse under 62 cannot be a borrower. They should be listed as an eligible non-borrowing spouse. Two consequences:
- The proceeds are calculated on their younger age, not yours. A 72-year-old with a 61-year-old spouse gets a 61-year-old's factor. That is a meaningful reduction and it is worth modelling both ways before deciding when to apply.
- They are protected. If the borrowing spouse dies, the non-borrowing spouse may remain in the home for life, provided they keep up with taxes, insurance and upkeep and establish legal ownership within the required window. They cannot draw further funds, and any line of credit closes.
Get this right the first time
Before 2014, non-borrowing spouses were routinely left off title and evicted after the borrower died. The rules changed, but only for loans originated after the change — and only where the spouse was correctly identified in the file. If anyone suggests leaving a younger spouse off the paperwork to increase your proceeds, end the conversation.
And what changes where you live
The rules above are federal and apply everywhere. Two of the states we serve add their own on top — New York makes counseling non-waivable and imposes a three-day wait, and California requires a seven-day cooling off period before a lender may charge you anything. Property tax relief, which matters more than either, varies in every one of them. The state pages set out what differs.
Which program you would be checking against
The rules above are the HECM rules, which is what most people mean. The proprietary and second-lien products set their own floors — some start at 55, and one leaves your existing mortgage in place entirely. Worth seeing the full set before assuming you do not qualify.
Under 62 today?
A HECM is closed to you, but two things are worth knowing. Some proprietary reverse mortgages start at 55 for higher-value homes. And because proceeds rise with age, waiting is not purely a loss — the same house yields more at 65 than at 62. If a payment is the pressure right now, a conventional refinance may simply be the better answer, and we will tell you so.
What this estimate is, and what it is not
These figures are an illustration for planning only — not a loan offer, not a commitment to lend, and not a guarantee of what you will receive. Your real numbers depend on a completed appraisal, the expected interest rate on the day your FHA case number is assigned, your existing mortgage payoff, and a HUD financial assessment. A reverse mortgage is a loan that must be repaid, not a government benefit. You remain responsible for property taxes, homeowners insurance and upkeep, and the loan can become due if you stop meeting those obligations.