Reverse Mortgage: 

A Complete Guide for Homeowners 62+

What Is a Reverse Mortgage?

A reverse mortgage is a type of home loan designed for homeowners aged 62 and older that allows you to convert part of your home equity into cash—without having to sell your home or make monthly mortgage payments.

Instead of paying the lender each month, the lender pays you.

The loan is repaid later—typically when you sell the home, move out permanently, or pass away.

How Does a Reverse Mortgage Work?

With a traditional mortgage, you make monthly payments to build equity.

With a reverse mortgage:

• You already have equity built up

• The lender allows you to borrow against that equity

• You receive funds in one of several ways:

  • Lump sum

  • Monthly payments

  • Line of credit

  • Combination of the above

Interest accrues over time, and the loan balance increases—but you’re not required to make monthly payments as long as you live in the home.

Who Qualifies for a Reverse Mortgage?

To be eligible, you must:

• Be 62 years or older

• Own your home (or have significant equity)

• Live in the home as your primary residence

• Be able to maintain:

  • Property taxes

  • Homeowners insurance

  • Basic home upkeep

Types of Reverse Mortgages

1. Home Equity Conversion Mortgage (HECM)

   • The most common type

   • Insured by the Federal Housing Administration (FHA)

   • Offers flexible payout options

2. Proprietary Reverse Mortgages

   • Private loans (not government-insured)

   • Typically for higher-value homes

3. Single-Purpose Reverse Mortgages

   • Offered by some local/state agencies

   • Must be used for a specific purpose (like home repairs)

Benefits of a Reverse Mortgage

• No monthly mortgage payments

• Stay in your home while accessing equity

• Flexible income options

• Can help cover:

  • Medical expenses

  • Daily living costs

  • Home improvements

• Non-recourse loan (you or your heirs won’t owe more than the home’s value)

Things to Consider

A reverse mortgage isn’t for everyone. It’s important to understand:

• Loan balance increases over time

• May reduce inheritance for heirs

• You must continue paying:

  • Property taxes

  • Insurance

  • Maintenance

• Fees and closing costs can be higher than traditional loans

When Does the Loan Get Repaid?

The loan becomes due when:

• You sell the home

• You move out permanently

• The last borrower passes away

At that point:

• The home is typically sold to repay the loan

• Any remaining equity goes to you or your heirs

Is a Reverse Mortgage Right for You?

A reverse mortgage can be a powerful tool if you:

• Want to age in place

• Need additional retirement income

• Have significant home equity but limited cash flow

However, it’s important to review all options and speak with a qualified mortgage professional before making a decision.

Let’s Help You Decide

At Elevated Funding, we believe in education first—not pressure.

If you’re exploring whether a reverse mortgage is the right fit, we’ll walk you through:

• Your eligibility

• How much you could access

• Alternative options that may better fit your goals