The HECM loan, the FHA insured reverse mortgage
The most common reverse mortgage in the country. Government backed, FHA insured, and built with real protections for homeowners 62 and older.
What HECM actually stands for
HECM stands for Home Equity Conversion Mortgage. It's the FHA insured reverse mortgage that lets qualified homeowners 62 and older access part of the value of their home. You can tap that equity in a few different ways, which gives you more cash flow in retirement.
Picture living in your home without a traditional monthly mortgage payment.1 Or picture enjoying monthly loan proceeds from the years you've invested in your home. That's what this loan makes possible.
Repayment isn't due until you sell the home, the last borrower passes away or permanently leaves the home, or the loan terms aren't met. You continue to pay property taxes and keep insurance in force, and you keep the home in good condition. For the full guidelines, check the reverse mortgages page.
Features, advantages, and qualifications
Reverse mortgage borrowers retain ownership and title to their home. It's yours just like it was before, but now you can benefit from the equity that's been building for years. HECM loans give you peace of mind because your home and property are the only assets that secure the loan.
Minimum age for at least one borrower on title.
The national HECM limit for 2026, used to calculate your upfront FHA mortgage insurance premium.
The Federal Housing Administration insures the loan through required Mortgage Insurance Premiums (MIP).
Why FHA insurance matters to you and your family
FHA requires a Mortgage Insurance Premium (MIP) collected at closing and throughout the life of the loan. Those premiums are charged to your loan balance. The upfront MIP is calculated using your home's appraised value or the $1,249,125 national HECM limit (whichever is lower). The ongoing FHA insurance is calculated on each month's outstanding balance.
Here's what that insurance actually gives you:
- You are never required to pay more than the home's fair market value.
- If the loan balance exceeds the home's value, FHA reimburses the lender for the difference when the estate sells the home.
- Payments made to you by the lender are insured by FHA. If the lender can't continue making payments, FHA takes over.
- If your loan balance grows past your home's current value, the lender cannot take title. You can live in your home as long as basic loan obligations are met.
To retain the home when the reverse mortgage becomes due, the heirs may choose to keep it by paying 95% of the home's appraised value, less customary closing costs and real estate commissions.
The math behind a reverse mortgage
How the numbers actually work, so you understand what a HECM would look like for your home.
My house has been my home for most of my life. I can't leave, but I can't afford to stay.
A dilemma the HECM was made for
Access your home's value without selling it
You live in a home you've watched increase in value for years. But bills and healthcare costs keep climbing. You're stuck between two bad options: sell the home you love, or keep watching the financial pressure grow.
A reverse mortgage resolves that dilemma. It lets you draw on a portion of your home's value without selling. You may receive monthly cash flow payments too. The loan is repaid when you sell your home, the last borrower passes away, you no longer live there as your primary residence, or you don't comply with the loan terms.
What you do with the proceeds is up to you. Enhance and extend your retirement, make home improvements, pay off other debt, take a trip you've been putting off, whatever fits your life.2
See what your home could unlock in retirement.
Get an EstimateA few things to know before you move forward
The HECM has built in protections for you, and one of them is required counseling. Here's what that looks like.
Everyone seeking a reverse mortgage is required to complete counseling from an independent HUD approved third party counselor before incurring any costs (other than the counseling fee itself). This is a real protection built into the loan and it's non negotiable.
Proceeds from a reverse mortgage are not subject to personal income taxation. That said, you should get tax advice on how the proceeds may affect any needs based government programs you receive, like Medicaid or Medi-Cal.2
You keep paying your property taxes, keep homeowner's insurance in force, and keep the home maintained in good condition. As long as you do those things and the home is your primary residence, the loan stays in place.
Ready to see your numbers?
Get a real estimate on your HECM, or just call and ask questions. Either way, no pressure and no obligation.
1 This advertisement does not constitute financial advice. Please consult a financial advisor regarding your specific situation. There are some circumstances that will cause the loan to mature and the balance to become due and payable. Borrowers are still responsible for paying property taxes, homeowner's insurance, and maintaining the property to HUD standards. Failure to do so could make the loan due and payable. Credit is subject to age, income standards, credit history, and property qualifications. Program rates, fees, terms, and conditions are not available in all states and subject to change.
2 Borrowers should seek professional tax advice regarding reverse mortgage proceeds.
*Borrowers must continue to pay property taxes, homeowner's insurance, and home maintenance costs.