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What should I think about before applying for a reverse mortgage loan and what should I ask a reverse mortgage counselor?

If you are considering a reverse mortgage loan, start by understanding how one works and how it will affect you now and in the future.

A detailed discussion with a reverse mortgage counselor will give you important information to help you decide whether a reverse mortgage loan is right for you. In order to get a Home Equity Conversion Mortgage (HECM), the most common type of reverse mortgage loan, you must receive counseling from a HUD-approved reverse mortgage counseling agency . However, you can talk to a reverse mortgage counselor even while you’re considering taking out a reverse mortgage loan.  

Questions to ask a housing counselor

If you’re considering a reverse mortgage, here are some sample questions to discuss with a housing counselor:

  • How does a reverse mortgage loan work? 
  • How is a reverse mortgage loan different from a traditional mortgage?
  • What are the upfront costs and fees in taking out a reverse mortgage loan? 
  • What will be the ongoing costs and fees if I have a reverse mortgage loan?
  • How will a reverse mortgage loan affect my spouse, or other people living with me?
  • What happens if I want to sell my home once I have a reverse mortgage loan?
  • What happens to my home when I pass away? 
  • What happens if I have to move to a nursing home?
  • How do I receive the money from my loan proceeds? Would it be better to take out the money as a line of credit, in monthly installments, or in a lump sum?
  • If I already have a mortgage on my house, how is that affected by a reverse mortgage?
  • What are my ongoing responsibilities once I have a reverse mortgage loan?
  • What other options should I consider other than a reverse mortgage loan?

If you discussed reverse mortgages with a lender before speaking with a counselor, tell your counselor about that discussion. Did the lender recommend a particular loan type? Did the lender try to sell you anything in addition to the reverse mortgage, or describe any conditions? Your counselor can give you unbiased information about the characteristics of the loan you may be considering.

What to do next

To learn whether a reverse mortgage is right for you, find a reverse mortgage housing counseling agency or call HUD's interactive voice system at 800-569-4287.