If you are 62 or older and you own your home, you have probably heard about reverse mortgages. You may have heard good things. You have almost certainly heard scary things. Most of what people hear is out of date or simply wrong.

This is the honest version. No sales pitch. Just the facts about a federally-insured program called the HECM — the Home Equity Conversion Mortgage — and whether it might fit your family's plan.

What a reverse mortgage actually is

A reverse mortgage is a loan. That is the first thing to understand. It is not a grant. It is not a government benefit. It is not the bank buying your house.

It is a mortgage, in reverse.

With a regular mortgage, you borrow money to buy a home and pay the lender back every month. With a reverse mortgage, you already own the home. The lender gives you money — drawn from the equity you have built — and no monthly mortgage payment is required as long as you live in the home and meet your obligations.

The loan does not come due until the last borrower moves out, sells the home, or passes away. At that point, the home is sold or the loan is paid off, and any remaining equity belongs to you or your heirs.

The HECM is the standard product

Almost every reverse mortgage originated in the United States is a HECM (Home Equity Conversion Mortgage). It is insured by the Federal Housing Administration and governed by federal rules that protect both borrowers and their heirs.

Key HECM features:

• FHA-insured — the insurance protects you, not the lender. If the loan balance ever exceeds the home's value, FHA covers the difference. You and your heirs never owe more than the home is worth.
• Non-recourse — your other assets are not at risk. The home is the only collateral.
• HUD-approved counseling required — you must speak with an independent, HUD-approved counselor before you apply. The counselor does not work for us. Their job is to make sure you understand the program.
• Flexible payouts — lump sum, monthly income, line of credit, or a mix. You choose what fits your family.

Who qualifies

The HECM program has four main requirements:

1. Age: the youngest borrower on title must be 62 or older. If one spouse is younger, they can often be added as a non-borrowing spouse with their own protections.
2. Primary residence: the home must be where you live most of the year. Vacation homes and rentals are not eligible.
3. Equity: you need meaningful equity — typically 50% or more — though the exact amount depends on your age and home value.
4. Financial assessment: the lender verifies that you can continue to pay property taxes, homeowners insurance, and maintenance. These are not paid by the reverse mortgage. They remain your responsibility.

How much you can access

The amount you can borrow is called the Principal Limit. It is a function of three things: the youngest borrower's age, the appraised value of the home (capped at the federal HECM lending limit), and a number published by HUD called the Principal Limit Factor.

Older borrowers qualify for more. Higher home values qualify for more — up to the HECM cap. The calculator above will give you a good first estimate.

How it is different from a regular mortgage

Four differences matter most:

Notice what the reverse mortgage does not change. You still own your home. Your name stays on the title. You can sell whenever you want. You can leave the home to your heirs. Your family decides what happens after you.

Six myths, addressed head on

Myth 1: "The bank takes my house."

No. You keep the title. The bank has a lien, just like with any mortgage. You can sell at any time. You can pay the loan off at any time. Your heirs have options when you pass away.

Myth 2: "I could owe more than my home is worth."

Not with a HECM. The FHA insurance makes it non-recourse. You and your heirs can never owe more than the home's appraised value at the time the loan comes due.

Myth 3: "My kids will be stuck with a bill."

No. Heirs inherit the home, not the debt. They have several options: keep the home by refinancing or paying the balance, sell the home and keep any remaining equity, deed the home to the lender if the balance exceeds value, or simply walk away. Non-recourse protection covers them.

Myth 4: "It's welfare."

A reverse mortgage is not a government benefit. It is a private loan insured by FHA. You are borrowing against your own equity. Nothing is given to you.

Myth 5: "I have to pay taxes on the money I receive."

Proceeds from a reverse mortgage are loan proceeds, not income. They are generally not taxable. Speak with your tax advisor about your specific situation.

Myth 6: "I'll lose my Social Security or Medicare."

Social Security and Medicare are not affected because they are not need-based. Need-based programs such as Medicaid or SSI can be affected depending on how proceeds are held. A HUD-approved counselor will walk through this with you.

When a HECM fits — and when it does not

It may fit when:

• You want to stay in your home and eliminate a required monthly mortgage payment.
• You want a standby line of credit that grows unused, as a hedge against future needs.
• You want to delay drawing Social Security to a higher benefit age.
• You need to cover healthcare or long-term care costs without selling investments at the wrong time.
• You are buying a new home (HECM for Purchase lets you buy without a required monthly mortgage payment).

It may not fit when:

• You plan to move within a few years — upfront costs take time to absorb.
• You cannot comfortably keep up with property taxes, insurance, and maintenance.
• Your goal is purely to maximize what you leave to heirs and you have other means to meet retirement needs.

What happens next

If the program sounds like it might be a fit, the next step is not a loan application. It is a 15-minute conversation, followed — if you want to keep exploring — by HUD-approved counseling. The counseling is required before you can even apply. It is designed to protect you.

We will walk through the numbers for your home, answer every question you have, and give you an honest read on whether a HECM fits your family. No pressure. Many people we talk with decide a reverse mortgage is not right for them today. That is a fine outcome too.