The home equity conversion mortgage (HECM) helps homeowners age 62+ turn a portion of their housing wealth into usable cash while continuing to live in and own their home.*
*The right to remain in the home is contingent on paying property taxes and homeowner’s insurance, maintaining the home, and complying with the loan terms.
A HECM reverse mortgage eliminates your monthly mortgage payment and unlocks funds that can be used virtually any way you wish to maintain and even improve your lifestyle.*
Increase your cash flow
Free up cash by eliminating the need to make a monthly mortgage payment.*
Cover medical expenses
Address ongoing medical expenses, emergencies, and long-term care.
Fund home renovations
Pay for home improvements that make your home safer, more enjoyable, and more suitable to your lifestyle.
Achieve your retirement goals
Take a well-deserved vacation, pursue hobbies and passions, and complete your retirement bucket list.
*The borrower must meet all loan obligations, including living in the property as the principal residence, maintaining the home, and paying property charges, including property taxes, fees, hazard insurance. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
A HECM is an FHA-insured loan for homeowners age 62 and older that lets you convert a portion of your home equity into tax-free funds. You can receive the money as a lump sum, monthly payments, a line of credit, or a combination of these options. Unlike a traditional mortgage, no monthly mortgage payments are required.*
Another key advantage is that any existing mortgage is paid off using the new loan proceeds, which can free up monthly cash flow for other expenses, goals, or opportunities as they arise. Learn More
*The borrower must meet all loan obligations, including living in the property as the principal residence, maintaining the home, and paying property charges, including property taxes, fees, hazard insurance. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
A HECM eliminates your monthly mortgage payment, if applicable, and loans you a portion of your home equity with no monthly mortgage payments required.* You can receive these funds via a lump sum, monthly payouts, a line of credit, or a mix of all three. Learn More
*The borrower must meet all loan obligations, including living in the property as the principal residence, maintaining the home, and paying property charges, including property taxes, fees, hazard insurance. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
A HECM is for homeowners 62+ who want to use their home wealth to maintain or even improve their lifestyle. It can be a strategic option for boosting income, covering medical costs, funding home improvements, or achieving retirement goals.
HECMs are FHA-insured for homeowners 62+ with a government lending limit and mortgage insurance requirement. HomeSafe is FOA’s proprietary jumbo reverse mortgage for homeowners 55+* who want to borrow up to $4 million without mortgage insurance or origination fees.
*For certain HomeSafe products only, excluding Massachusetts, New York, and Washington, where the minimum age is 60, and North Carolina and Texas where the minimum age is 62.
A HECM loan is repaid when the homeowner moves out, doesn’t meet the loan conditions, or passes away. The loan can be settled by selling the house or by using other assets if the borrower or heirs prefer to keep the house. Most importantly, the borrower or heirs won’t owe more than the home’s value.
While a reverse mortgage doesn’t require monthly mortgage payments*, there is an important tradeoff to understand. Like any loan, a reverse mortgage charges interest. If you choose not to make payments, the interest is added to the loan balance over time, which means the amount owed can grow.
The good news is that you can pay as much or as little as you’d like—including nothing at all. Any payments you make can help reduce the amount of interest that accrues, slow the growth of the loan balance, and preserve more of your home equity.
*The borrower must meet all loan obligations, including living in the property as the principal residence, maintaining the home, and paying property charges, including property taxes, fees, hazard insurance. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
HECM reverse mortgages include built-in borrower safeguards required by the Federal Housing Administration (FHA). Before closing, you’ll complete independent HUD-approved counseling to help you understand the loan and determine whether it’s right for you. You’ll also benefit from non-recourse protection, which means you or your heirs won’t owe more than your home’s value when the loan becomes due and is repaid. As long as you meet your loan obligations, you maintain ownership of your home and can continue to live there.*
*The right to remain in the home is contingent on paying property taxes and homeowner’s insurance, maintaining the home, and complying with the loan terms.
