What is the Minimum Age for a Reverse Mortgage?
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July 27, 2018
in Blog

What is the Minimum Age for a Reverse Mortgage?

A reverse mortgage is a federally insured1 loan for senior homeowners that allows you to convert your home equity into cash without having to make monthly mortgage payments.2 In today’s world, with seniors struggling to keep up with an increasing cost of living, a reverse mortgage can be an invaluable financial tool. If you, like so many others, are considering a reverse mortgage as a financial tool to supplement your income in retirement, you may be wondering: What is the minimum age for a reverse mortgage?

The minimum age that a homeowner can qualify for a reverse mortgage is 62 years old. Setting up a reverse mortgage line of credit as soon as you turn 62 may be a smart financial decision because the amount available in the line of credit will grow over time.3 Setting it up before you need it can help you be ready to tackle unexpected expenses as they arise. The growth is independent of your home’s value, which means that your line of credit will continue to grow even if your home declines in value. Interest is only charged on the amount that you withdraw.

What if I’m 62 but my spouse isn’t, can we still qualify?

It is possible to get a reverse mortgage even if one spouse is not yet 62 years old. A spouse who is not 62 yet will not qualify as a borrower, but may still be included on the loan as a non-borrowing spouse (NBS). This may be an option if you wish to get a reverse mortgage as soon as possible while protecting your spouse from having to immediately repay the loan in the event you pass away or move away from the home for long term medical care.

In order to apply with a NBS the following requirements must be met:

  • You are married at the time the loan closes and remain married for the life of the loan
  • Your spouse is named as the non-borrowing spouse on the official documents of the reverse mortgage
  • Your spouse can continue to meet the loan obligations such as maintaining the home and paying for homeowners insurance and property taxes even if you no longer live in the home
  • You must provide certification at loan closing and annually each year following (for the life of the loan) that shows you are married
  • If you do pass away or move into a long term healthcare facility your spouse must be able to prove within 90 days of you no longer residing in the home that they legally own the home or have the legal right to remain on the property

Once your younger spouse meets the minimum age for a reverse mortgage you have the option to refinance to have you both listed as borrowers on the loan.

Are there any restrictions on how I can use the funds?

The money from a reverse mortgage can be used any way you choose. Common uses are to supplement income, pay off other debt, or to help with large unexpected expenses such as home repairs or healthcare.

If you are interested in learning more about whether a reverse mortgage may help you be more financially secure in retirement, fill out the calculator above or call 1.800.976.6211.

Important Disclosures

1Federal Housing Administration (FHA) mortgage insurance premiums (MIP) will accrue on your loan balance. You will be charged an initial MIP at closing. The initial MIP will be 2% of the home value not to exceed $13,593. Over the life of the loan, you will be charged an annual MIP that equals .5% of the outstanding mortgage balance.

2You must live in the home as your primary residence, continue to pay required property taxes, homeowners insurance, and maintain the home according to FHA requirements. Failure to meet these requirements can trigger a loan default that may result in foreclosure.

3The reverse mortgage loan balance grows at the same rate as the available line of credit. Line of credit growth occurs and is only a benefit when a portion of the line of credit is not used. The unused line of credit grows over time and more funds become available during the life of the loan.