Can my partner, family, or dependents live in my home if I have a reverse mortgage?
As long as you still live in the home, a reverse mortgage does not change who can live with you.
Most reverse mortgages today are Home Equity Conversion Mortgages (HECMs). The Federal Housing Administration (FHA), a part of the Department of Housing and Urban Development (HUD), insures HECMs. As long as you still live in the home, having a HECM does not change who can live with you. However, if you die or move out of the home, the people who live with you may not be able to continue to live in the home without you.
Note: This webpage has information about HECMs, which are the most common type of reverse mortgage.
If you are co-borrowing your HECM with a spouse (or anyone else), your co-borrower can stay in the home even if you die or move out of the home. If you live with a non-borrowing spouse or partner, that person may be able to remain in the home after you die if they qualify under guidelines established by HUD. Note that this benefit for non-borrowing spouses and partners does not apply if you move to a nursing home or other healthcare facility for more than 12 consecutive months. It also does not apply if you no longer live in the home for the majority of the year for other reasons.
Children, relatives, or other dependents who are not co-borrowers on the reverse mortgage will likely have to move.
Most borrowers or their heirs will need to sell their home in order to repay the reverse mortgage. With an FHA-insured HECM loan, if the loan balance is more than your home is worth, you or your heirs don’t have to pay the excess. After you or your heirs sell the home, the lender will take the proceeds from the sale as payment on the loan, and the FHA insurance will cover any remaining loan balance.
If you or your heirs would like to keep your home instead of selling it, the loan must be paid off with another source of funds. But you or your heirs won’t have to pay more than the full loan balance or 95 percent of the home’s appraised value, whichever is less.
Before you apply for any reverse mortgage loan, you and your spouse or partner should seek a HUD-approved counselor to help you decide if a reverse mortgage is right for you. To talk to a HUD-approved reverse mortgage (HECM) counselor visit HUD's counselor search page, or call HUD's housing counselor referral line at (800) 569-4287.