Reverse Mortgage Loans

Reverse mortgage rates in 2026 run roughly 6.5% to 8.5% depending on whether you take a fixed lump sum or an adjustable line of credit. HECM rates are tied to the 10-year Constant Maturity Treasury (CMT) index plus a lender margin, so they move with the broader bond market.

Here's the nuance most calculators miss: the rate affects how much you can borrow. HUD's Principal Limit Factor drops slightly as the expected interest rate rises — lower rates let you pull more equity out, higher rates pull less. That's why timing matters.

Adjustable-rate HECMs generally let you access more equity than a fixed-rate product, and the unused portion of your line of credit grows at the note rate. That growth is one of the most under-appreciated features of the program.

I'll price your specific scenario against current market rates — send me your numbers and I'll tell you exactly what you qualify for today.

A home equity loan gives you a lump sum at closing and a fixed monthly payment for 10 to 30 years. It's predictable, but that monthly payment is real money out of your retirement budget — every single month.

A reverse mortgage can also give you a lump sum, but you never make a monthly mortgage payment. Instead, interest accrues against the home's equity and the loan is settled when you sell, move, or pass away.

For retirees on a fixed income, the preserved monthly cash flow often matters more than the interest rate on the debt. That's why the reverse mortgage wins for most clients in their 60s and 70s who plan to stay put.

Reverse mortgage closing costs are higher than a conventional mortgage because of the FHA insurance premium — but almost all of it can be financed into the loan.

• Origination fee — capped by HUD formula; for most loans this runs $2,500 to $6,000.
• FHA upfront MIP — 2% of the home value or the HECM lending limit, whichever is less.
• FHA annual MIP — 0.5% of the loan balance annually, accrued into the balance.
• Third-party fees — appraisal, title, recording, credit report, flood cert. Typically $2,500 to $4,000.
• HUD counseling — required independent counseling session, usually $125 to $200.

The vast majority of clients finance the closing costs into the loan and pay little to nothing out of pocket at the table. Zack will give you a line-by-line estimate before you commit to anything — free, no credit pull.

California is one of the most active reverse mortgage markets in the country — and for good reason. High home values in markets like Los Angeles, San Diego, San Francisco, and Orange County mean homeowners often have substantial equity to work with.

For California seniors, the HECM lending limit ($1,149,825 in 2026) usually becomes the ceiling because home values exceed it. That means even million-dollar-plus homes still get meaningful proceeds — just capped at the federal limit.

California's Prop 13 property tax treatment also pairs well with a reverse mortgage: you keep your low tax basis while accessing equity you built over decades. I close reverse mortgages across California every month.

Florida is a reverse mortgage heartland — a huge retiree population, no state income tax, and a homestead exemption that makes aging in place attractive. Markets like Tampa, Naples, Sarasota, The Villages, and South Florida see heavy HECM activity.

If you're relocating to Florida for retirement, HECM for Purchase is particularly useful: combine the proceeds from selling your northern home with a reverse mortgage on the new Florida home and you can often buy outright with no monthly payment — while keeping more cash in reserve.

Zack is licensed in Florida and closes reverse mortgages for clients across the state. Ask about HECM for Purchase if you're thinking about a move.

Yes — and it happens more often than people realize.

The two most common reasons someone refinances a reverse mortgage:

One — they want to convert back to a conventional mortgage. Maybe they want to leave the home to heirs without a reverse mortgage balance attached. Or their financial situation changed and they can now qualify for a traditional loan.

Two — they want a better reverse mortgage deal. If home values went up significantly or interest rates dropped, refinancing into a new reverse mortgage can increase the principal limit — meaning more available cash.

Refinancing a reverse mortgage into a conventional mortgage requires:

• Enough equity to qualify after paying off the reverse mortgage balance
• Sufficient income to qualify for regular monthly payments
• Credit score meeting conventional standards

Most people who refinance OUT of a reverse mortgage do so because they moved in a non-borrowing spouse, their financial situation improved, or they want to simplify the estate for their heirs.

If you are inside a reverse mortgage and wondering about your options, Zack will walk through both directions with you — no obligation.

Several things can disqualify a borrower — and most people don't know about them until they're already in the process.

Age: You must be 62 or older. The youngest borrower on the title sets the qualifying age. If you are 68 and your spouse is 59, your spouse's age is the limiting factor.

Property type: The home must be your primary residence. Investment properties, vacation homes, and second homes do not qualify. Condos must be FHA-approved.

Home condition: The property must meet FHA minimum property standards. Deferred maintenance, structural issues, or safety hazards can delay or kill approval.

Existing liens: If you have a large mortgage balance relative to your home value, the reverse mortgage proceeds may not cover it. The reverse mortgage must pay off all existing liens at closing.

Federal debt: Outstanding federal tax liens or federal student loan defaults can disqualify you.

HUD counseling: Every HECM borrower must complete a HUD-approved counseling session. Skipping or refusing this disqualifies you automatically.

Credit score: There is no minimum credit score for a HECM reverse mortgage. However, the lender will conduct a financial assessment to ensure you can maintain property taxes and insurance.

Most people think a reverse mortgage means a lump sum check. That is one option. But the line of credit option is often the smarter financial move.

Here is what makes it different:

The unused portion of a reverse mortgage line of credit grows over time. It grows at the same rate as the loan interest rate. If your rate is 7%, your available line grows at roughly 7% per year — even if home values decline.

A borrower who takes a $200,000 line of credit at 65 and lets it sit untouched for 10 years might have $380,000 available at 75 when they actually need it.

No other financial product works this way.

Three reasons people choose the line of credit over a lump sum:

Emergency reserve: Keep it available for healthcare costs, home repairs, or unexpected expenses.

Market timing: Draw from the line when markets are down instead of selling investments at a loss.

Growing access: Let the available amount compound while your needs are modest, draw when needs increase.

The line of credit cannot be frozen or reduced as long as you meet the loan terms — unlike a HELOC, which a bank can freeze at any time.

Property type determines whether you qualify for a standard HECM, a jumbo proprietary reverse mortgage, or no reverse mortgage at all. Here is how each common property type plays out.

The standard HECM reverse mortgage has a lending limit of $1,149,825 in 2026. If your home is worth more than that, a jumbo reverse mortgage — also called a proprietary reverse mortgage — is your option.

Jumbo reverse mortgages are not FHA-insured. They are private products offered by specific lenders with their own guidelines.

Key differences from HECM:

• Loan amounts up to $4-6M on some programs
• No FHA mortgage insurance premium
• May allow age 55+ (vs 62 for HECM)
• Fewer consumer protections
• Less standardized — terms vary by lender

Who uses jumbo reverse mortgages: Homeowners in California, New York, Florida, and other high-value markets where $1M+ homes are common.

The calculator on this page uses HECM limits. For a jumbo reverse mortgage estimate, contact Zack directly — the calculation depends on the specific lender program and your property value.

Note on the calculator above: For homes over $1,149,825, see Jumbo Reverse Mortgage options in this section.

Yes — you can sell a home with a reverse mortgage at any time.

Here is how it works:

When you sell, the reverse mortgage balance gets paid off first from the proceeds. Whatever is left belongs to you.

If the home sells for more than the loan balance — which is typical if you have significant equity — you keep the difference.

If the home sells for less than the loan balance, the FHA insurance covers the shortfall. You and your heirs owe nothing beyond the home's value. This is the non-recourse protection.

Short sale with a reverse mortgage: If the home value dropped below the loan balance, a short sale can be arranged with HUD approval. The lender accepts less than the full balance. You owe nothing.

One important note: your heirs have 12 months after the last borrower leaves the home to sell, refinance, or settle the loan.