Reverse mortgages can be both a lifeline and a long-term liability — depending on who you trust to service it. While marketing often promises “no monthly payments,” the real differentiator isn’t the loan itself, but the lender’s ethics, servicing model, and transparency.
Key Takeaways: Quick Answers for Seniors
❓ Question
💡 Expert Answer
Is there a “new” federal reverse mortgage rule?
No — only an evolving FHA framework with updated limits and counseling safeguards.
What is the safest reverse mortgage type?
HECMs, federally insured by HUD with non-recourse protection.
What’s the key lender red flag?
High BBB score but low consumer ratings — it signals compliance but poor service.
Which lender waives long-term fees?
Longbridge Financial – the only major lender with $0 monthly servicing fees.
Should I pick fixed or adjustable?
Adjustable (line of credit) options allow flexibility — unused credit grows over time.
Who should I avoid?
Any company with frequent servicing transfers or CFPB enforcement actions.
Is proprietary better for high-value homes?
Yes, but only when terms include non-recourse clauses and independent legal review.
Do all require counseling?
HECMs do — federal law mandates HUD-approved counseling before application.
How to compare lenders fast?
Focus on 3 metrics: Net proceeds, Servicing fees, and Customer satisfaction %.
Can I lose my home?
Only if you fail to pay taxes, insurance, or upkeep — not for age or income.
1. Why Service Quality Matters More Than the Interest Rate
A reverse mortgage may last 15–25 years, outliving most traditional loan cycles. The servicer’s stability — not the advertised APR — determines your peace of mind.
🔍 Factor
💬 What It Means
🧠 Expert Tip
Servicing Retention
Whether the lender manages your loan long-term
Choose lenders that keep servicing in-house
Monthly Servicing Fee
Fee added monthly to your balance
Waived by Longbridge Financial = thousands saved
Regulatory Record
CFPB/FTC complaints history
Avoid lenders with servicing violations (e.g., NOVAD precedent)
Accessibility
Online portals, mobile app
Look for 24/7 visibility of loan balance and disbursements
💡 Pro Tip: Choose transparency over scale — the largest lenders often outsource servicing, which increases risk of miscommunication, lost paperwork, or wrongful foreclosure.
2. Top 10 Reverse Mortgage Companies for Seniors
🏦 Lender
⭐ Best For
💵 Avg. HECM Rate
🌍 Availability
💰 Servicing Fee
🧭 Key Advantage
1️⃣ Longbridge Financial
Best Overall / Customer Experience
6.16%
50 States
$0 (Waived)
Highest satisfaction, FHA & Jumbo options
2️⃣ Guild Mortgage
Best for Low Rates
6.12%
49 States
$30
Consistently lowest APRs nationwide
3️⃣ Fairway Independent Mortgage
Best for Home Purchase (H4P)
6.35%
50 States
$35
E-closings & specialized H4P expertise
4️⃣ Finance of America Reverse (FAR)
Largest Volume Lender
6.25%
All States
$30
Proprietary “HomeSafe” up to $4M
5️⃣ South River Mortgage
Best for Refinancers
6.25%
28 States
$30
HECM refinance specialists
6️⃣ Mutual of Omaha Reverse
Best Brand Recognition
6.28%
Most States
$35
Trusted name, broad FHA access
7️⃣ HighTechLending Inc.
Best Boutique Service
6.40%
Limited States
$30
99% satisfaction rating
8️⃣ Goodlife Home Loans
Most Transparent Fees
6.37%
45 States
$30
Simple terms, senior-friendly process
9️⃣ Northwest Reverse Mortgage
Best for Comparison Access
6.29%
28 States
Varies
Brokerage access to multiple lenders
🔟 All Reverse Mortgage
Lowest Regional Rates (13 States)
6.10%
13 States
$30
Ultra-low fixed rates, limited geography
3. Behind the Numbers: What Consumer Ratings Reveal
Big names often get A+ from the BBB, but borrower experiences tell a different story.
🧾 Lender
🧠 Consumer Rating (0–5)
💬 Positive Review %
🧩 Complaint Volume
📉 Observed Issue
Longbridge Financial
3.87/5
77%
32
Clear communication, top service
Finance of America Reverse (FAR)
1.00/5
20%
37
Poor post-closing communication
Mutual of Omaha Reverse
1.53/5
31%
62
Long response times
HighTechLending
4.94/5
99%
1
Exemplary personalized service
Goodlife Home Loans
4.80/5
96%
2
High transparency
Guild Mortgage
3.50/5
70%
24
Low rate, moderate service speed
🧭 Expert Insight: A+ ratings confirm complaint resolution, not customer happiness. If thousands of seniors give 1-star reviews, that’s not a coincidence — it’s a pattern.
4. The “Hidden Cost” Lenders Don’t Advertise — Servicing Compounding
⏳ Duration
💸 $30/Month Fee Compounded
💔 Lost Equity
10 Years
~$4,800
Erodes 1–2% of home value
15 Years
~$8,100
Nearly a full year of property tax payments
20 Years
~$13,200
Substantial inheritance loss
💡 Longbridge’s $0 fee policy saves seniors $10K+ over 20 years — a silent but decisive financial differentiator.
5. FHA vs. Jumbo: Which Reverse Mortgage Type Fits You Best?
🏠 Criteria
🪙 FHA-Insured HECM
💎 Proprietary (Jumbo)
Age Eligibility
62+
55+ (varies by lender)
Loan Cap (2025)
$1,209,750
$4–5 million
Federal Insurance
✅ Non-recourse guarantee
❌ Depends on lender contract
Counseling Required
✅ HUD-approved mandatory
⚠️ Optional (seek independent advice)
Best For
Typical retirees
High-value home or early-access equity
Example Lenders
Longbridge, Guild, Fairway
FAR, Longbridge Platinum, Goodlife Jumbo
6. How to Spot a Safe Reverse Mortgage Lender
🧭 Evaluation Metric
✅ What to Look For
🚫 What to Avoid
Servicing Policy
Retained, in-house, transparent
Transferred to third-party servicer
Fee Disclosure
All costs listed pre-application
Hidden “servicing” or “disbursement” fees
Regulatory Record
No CFPB enforcement
Past or ongoing CFPB actions
Counseling Support
Proactive, HUD-linked referrals
Pushy, “pre-counseled” claims
Customer Portal
Real-time loan status
Paper-only communications
BBB vs. Consumer Rating
≥3.5 stars + low complaint volume
A+ with <2 stars from customers
💬 Expert Tip: Before signing, call the lender’s servicing line directly — if you wait more than 3 minutes on hold, imagine that multiplied over 15 years.
7. Seniors’ FAQ: Straight Answers to Uncomfortable Questions
❓ Question
💬 Expert Answer
“What happens if I outlive my reverse mortgage?”
You never lose ownership — the loan only becomes due when you sell, move, or pass away.
“Can my heirs keep the house?”
Yes. They can pay 95% of its appraised value to retain it — even if the loan balance is higher.
“Will I owe taxes on the funds?”
No. Proceeds are loan advances, not taxable income.
“Can I refinance my HECM later?”
Absolutely — refinancing with lenders like South River can increase available funds.
“Are reverse mortgage ads misleading?”
Many are. Verify claims via CFPB or HUD complaint databases before applying.
“How long does the process take?”
Typically 30–45 days, including mandatory HUD counseling.
8. Red Flags to Avoid Before Signing
🚫 Red Flag
🧠 Why It Matters
💡 Safer Alternative
“No Counseling Needed” Claims
Illegal under HECM rules
Require HUD counseling certificate
Aggressive “Act Now” Ads
Pressure sales = poor ethics
Demand written loan summary
“We Partner With the Government”
Misleading advertising
Verify lender via HUD Lender List
“We Guarantee the Highest Payout”
Often excludes hidden costs
Compare Net Proceeds, not gross loan amount
Unfamiliar Servicer Name Post-Closing
Indicates servicing sale
Choose servicing-retained lenders
9. Practical Checklist Before Choosing a Reverse Mortgage Company
💡 Rule of Thumb: Never choose based on one phone call. Get at least three written quotes, compare net disbursement after costs, and ask directly about fee waivers.
10. Expert-Recommended Pairings Based on Borrower Profile
👤 Borrower Type
🧭 Best Lender Match
💡 Why
Traditional Retiree (62+, <$1.2M Home)
Longbridge Financial (HECM)
Low cost + top service
Rate Shopper
Guild Mortgage / All Reverse Mortgage
Lower interest = more cash
Early Retiree (55+, High-Value Home)
Longbridge Platinum / FAR HomeSafe
Jumbo flexibility
Refinancer
South River Mortgage
Re-optimizes existing HECMs
New Home Buyer (H4P)
Fairway Independent Mortgage
Simplified purchase setup
Privacy-Focused Senior
HighTechLending / Goodlife
Boutique, low-pressure service
FAQs
Can my spouse under 62 stay in the home if I’m the only borrower?
Yes—if it’s a HECM and they’re recorded as an “Eligible Non-Borrowing Spouse (NBS)” at closing. That status preserves the right to remain in the property after the borrower dies or permanently leaves, but the line of credit and monthly payments stop and no new draws are allowed. All loan obligations (taxes, insurance, occupancy, maintenance) must still be met.
Will I lose the house if home values fall below my loan balance?
With a HECM, no. It’s non-recourse: neither you nor heirs owe more than 95% of current appraised value or the loan balance—whichever is less—at maturity. Proprietary (jumbo) loans may mirror this, but it’s contract-based, so read the non-recourse clause carefully.
📉 Home Value vs. Balance
🧠 Outcome
🙂 Heir Options
Value < Balance (HECM)
FHA insurance absorbs shortfall
Buy at 95% of value, or deed-in-lieu, or walk away
Value > Balance
Equity remains for heirs
Sell and keep surplus
What actually triggers “due and payable” on a reverse mortgage?
It isn’t age—it’s eligibility failures or maturity events. The most common avoidable triggers: property taxes, insurance lapses, or occupancy missteps.
Do required repairs before/after closing as agreed
Title changes
Unauthorized transfer
Notify servicer; use approved estate planning tools
I’ve heard of a “LESA.” Should I accept one?
A Life Expectancy Set-Aside (LESA) is a reserve funded from proceeds to pay taxes and insurance for your estimated remaining years. A fully funded LESA dramatically reduces default risk for those on fixed incomes.
🧮 LESA Type
🧾 What It Covers
🎯 Best For
🤔 Tradeoff
Fully funded
All future taxes/insurance
Predictable budgets
Reduces immediate cash
Partially funded
Some T&I, borrower pays rest
Variable budgets
Requires careful cashflow
What if my servicer sells my loan after closing?
Servicing transfers are common—but communication gaps cause problems. You’ll receive a goodbye and hello letter. Keep both. Create a single file with tax bills, insurance declarations, occupancy forms, and payoff quotes. If you suspect errors, write (not call) a Qualified Written Request (QWR) to the new servicer and keep proof.
📬 Event
✅ Your Move
🧠 Why It Matters
Transfer notice
Save both letters
Confirms where to send taxes/claims
First statement
Set up portal + auto-pay
Avoids T&I lapses
Dispute
Send QWR by certified mail
Preserves rights & timelines
Can I make voluntary payments on a reverse mortgage to control the balance?
Yes. Despite “no required payment,” you can prepay any amount, anytime, without penalty on HECMs. Smart strategy: target interest + MIP + servicing periodically to keep balance flat while retaining access to your line of credit.
🧰 Tactic
💡 Purpose
💵 When Useful
Quarterly interest/MIP prepay
Slow compounding
Large LOC you don’t need now
Lump-sum curtailment
Restore equity
Preparing for sale/refi
Annual catch-up
Budget-friendly control
Fixed-income households
Is a fixed rate safer than an adjustable HECM?
Not necessarily. Fixed HECMs require lump-sum draws and eliminate the growing line of credit. Adjustable HECMs enable tenure/term payments or a line of credit that grows at the note rate + MIP—a unique hedge against longevity and inflation.
⚖️ Option
✅ Strength
⚠️ Tradeoff
🧠 Best Fit
Fixed
Predictable rate, lump sum
No LOC growth; less flexibility
Immediate, one-time need (payoff big mortgage)
Adjustable (LOC/tenure)
LOC growth, flexible draws
Rate can change
Long horizon, cashflow planning
Can I use a reverse mortgage to buy my next home (H4P)?
Yes, HECM for Purchase (H4P) lets you buy and never have monthly principal/interest payments. You’ll need a large down payment (often 45–65% depending on age/rates), and the property must meet FHA standards.
🏠 Step
✅ Requirement
🙂 Tip
Down payment
From sale proceeds/cash (no borrowed funds)
Season funds; document source
Property
Primary residence, FHA-eligible
Pre-clear condo status early
Timing
Counseling before contract close
Align counseling + appraisal to avoid delays
Are condos, co-ops, or manufactured homes eligible?
Condos: HECM requires FHA-approved project or single-unit spot approval with strict criteria.
Co-ops: Generally not HECM-eligible; some proprietary loans may consider case-by-case.
Manufactured homes: Possible if they meet HUD code, permanent foundation, title elimination, and age/condition standards.
🏢 Property Type
🔎 Key Hurdle
🧭 Workaround
Condo (non-approved)
HOA docs, budget reserves
Pursue spot approval early
Co-op
Ownership structure
Explore proprietary terms
Manufactured
Foundation/title issues
Engineer cert + title purge
What happens if I need major repairs before closing?
Underwriters may require a Repair Rider with escrows or completion prior to funding. Prioritize health/safety items (roof, electrical, plumbing) to avoid funding holdbacks and occupancy delays.
🔧 Defect Type
🛠️ Typical Requirement
🗓️ Timing
Roof leaks
Repair before closing or escrow
Pre-order contractor bids
Electrical hazards
Licensed fixes + re-inspection
Build in time for permits
Trip hazards/rails
Minor cure or post-close escrow
Photo verification accepted sometimes
Could a reverse mortgage affect Medicaid or other benefits?
HECM proceeds aren’t income, but unspent cash can become a countable asset for means-tested programs (Medicaid/SSI). Use structured draws (tenure/term) rather than large lump sums if benefits are in play; consult an elder-law attorney.
🧮 Benefit
💬 Effect of HECM
✅ Safer Draw Pattern
Medicaid/SSI
Asset limits apply to balances
Small, regular draws; keep cash under thresholds
Social Security/Medicare
No impact
N/A
How do heirs actually settle the loan—step by step?
They notify the servicer, order an FHA appraisal, and choose to sell, refinance, or deed-in-lieu. They typically get 6 months, with possible two 3-month extensions if progress is shown.
🧾 Heir Path
🪜 Steps
🕰️ Timeline
Keep the home
Refinance at 95% of value
Within 6–12 months
Sell the home
List, accept offer, pay off
Similar window
Walk away
Deed-in-lieu if underwater
Coordinate with servicer
What should my Power of Attorney (POA) say for reverse mortgage planning?
Use a durable, specific POA that explicitly authorizes mortgage origination, draws, repairs authorization, and payoff. Servicers scrutinize POAs—state-compliant language and notarization avoids delays.
📜 POA Clause
✅ Include
💡 Why
Real property transactions
Yes
Approve origination/refi
Debt instruments
Yes
Authorize draws/payoffs
Repairs/insurance
Yes
Maintain eligibility
How do I compare offers without getting lost in rate talk?
Ask every lender for a same-day, apples-to-apples summary of net proceeds under three distribution options (lump sum, tenure, LOC), including itemized MIP, origination, third-party costs, and servicing.
📋 Comparison Box
🎯 What To See
🚫 Ignore
Net proceeds
Cash after all fees & payoffs
Headline rate without context
Servicing policy
Retained vs. transferred; monthly fee
“We’re A+ BBB!” without reviews
LOC growth terms
Index, margin, MIP
Vague “highest cash” claims
What if I get a scary “occupancy” letter while I’m caregiving away from home?
Respond in writing immediately. Provide proof of primary residence (ID, utility bill, voter registration) and a temporary-absence letter explaining caregiving dates. If needed, ask for a reasonable-cause extension.
📨 Notice Type
🧠 Response Packet
🧯 De-escalation
Occupancy certification
ID + recent bill + letter
Send certified mail, keep copies
Due-and-payable threat
Add POA/attorney letter
Request pause while curing issue
Can I refinance a HECM to improve terms or access more cash?
Yes—HECM-to-HECM refis are common when rates, principal limit factors, or home values improve. Confirm a tangible net benefit: more LOC, lower margin, or reduced costs. Avoid “serial refis” that reset fees without value.
🔁 Refi Trigger
🧮 Benefit Test
🧠 Rule
Lower margin
Higher principal limit
Must exceed new fees
Higher value
More available LOC
Verify with updated appraisal
New goals
Switch to tenure/term
Align with budget plan
Are proprietary (jumbo) reverse mortgages ever the better choice?
For high-value homes or ages 55–61, yes. But protections are contractual, not federal. Insist on written non-recourse language, clear servicing policies, and fee caps. Consider independent legal review before signing.
💎 When Jumbo Wins
🛡️ What to Insist On
🔍 Document to Read Twice
Value above HECM cap
Non-recourse clause
Loan agreement, servicing addendum
Age <62 (state-permitting)
Counseling (even if optional)
Marketing vs. contract consistency
Condo/unique property
Defined draw & rate mechanics
Prepayment terms, resets
How do I bulletproof my file before closing? (Faster, fewer surprises)
Create a single binder (paper + digital) with: counseling certificate, ID, deed, recent tax bill, insurance dec page, HOA statement (if condo), repair bids, and beneficiary/POA documents.
📁 Section
📎 Contents
😊 Outcome
Property
Deed, tax bill, insurance
Smooth underwriting
Counseling
HUD certificate
Compliance checked
Budget
LESA/escrow decision notes
Default prevention
Estate
Will/POA/trust
Heir process simplified
If my taxes/insurance fell behind, can I cure and reinstate?
Often yes. Contact the servicer quickly to pay arrears or set up LESA if eligible. Request in writing that “due and payable” be rescinded upon cure and ask for fee waivers where hardship is documented.
🧯 Default Type
🛠️ Cure Path
📝 Ask For
Tax delinquency
Pay + receipt to servicer
Administrative fee waiver
Insurance lapse
Bind new policy + binder
Reinstatement letter
Both
LESA evaluation
Written confirmation of cure
How do state property-tax relief programs interact with a HECM?
State senior exemptions, deferrals, and circuit-breaker credits can coexist with a HECM, but the servicer still requires proof that taxes are paid or formally deferred each cycle. A deferral is not delinquency if the jurisdiction records it correctly. Always file renewals on time and upload receipts to your portal.
🧾 Program Type
🧠 HECM Impact
✅ What You Do
🙂 Tip
Exemption/Credit
Lowers annual tax due
Submit award letter each year
Calendar a renewal reminder
Deferral
Acceptable if recorded
Upload deferral approval & lien notice
Ask servicer how they want proof
Installment Plan
Must remain current
Auto-pay from checking or LESA
Avoid late fees that trigger reviews
Can an active bankruptcy stop me from getting or keeping a reverse mortgage?
Origination: Chapter 7 must be discharged; Chapter 13 typically needs court/trustee approval. After closing: Bankruptcy doesn’t auto-mature the loan, but you must keep taxes, insurance, and occupancy current. Always tell your attorney about the HECM so the plan protects housing obligations.
⚖️ Status
🔎 Lender View
🧭 Action
Ch. 7 Discharged
Often eligible
Provide discharge + credit re-established
Ch. 13 Active
Case-by-case
Obtain court OK + payment history
New Filing Post-HECM
Loan continues
Keep T&I current; notify servicer & counsel
Divorce in progress—how do title and proceeds work without derailing the loan?
A HECM requires clear title and documented intent to occupy by all borrowers. If divorcing, use a marital settlement agreement (MSA) or court order that states who stays, who borrows, and how proceeds are split. Servicers scrutinize occupancy—avoid informal deals.
💍 Issue
📄 Needed Evidence
🧠 Why It Matters
One spouse remains
Deed + MSA allotting residence
Confirms primary residence
Both over 62
Co-borrow to protect both
Avoids NBS complexity
Buyout at close
Payoff demand + wire instructions
Prevents post-close disputes
What if a disaster damages my home—does insurance money affect the HECM?
Insurance claim checks may be co-payable to you and the servicer. Funds are released in draws tied to inspections to ensure repairs restore collateral. Keep detailed invoices and photos; request expedited inspections for safety issues.
🌪️ Event
💵 Claim Flow
🔧 Release Condition
🙂 Shortcut
Wind/Flood/Fire
Jointly payable check
Stage-based inspections
Pre-select licensed contractor
Minor damage
Small disbursement
Photos & receipts
Ask for desk review to avoid site visit
Total loss
Complex review
Rebuild or payoff path
Talk to loss-draft team early
How fast does a HECM line of credit (LOC) actually grow?
The unused LOC grows at note rate + annual MIP (credited monthly). That guaranteed growth is independent of home value—unique to HECMs. It’s why many planners favor adjustable products for longevity risk.
📈 Variable
🔍 What It Means
🧮 Practical Implication
Index + Margin
Your adjustable rate
Higher rate = faster LOC growth but higher cost if you draw
MIP Add-On
Added to growth formula
Growth tracks total accrual rate
Unused LOC
Compound base
Early restraint → larger future access
Rate anatomy: index, margin, lifetime cap—what should I negotiate?
Focus on margin (lender-set) and lifetime cap. Indexes float with the market, but the margin sticks for life and directly affects both accrual cost and LOC growth. A tighter lifetime cap reduces extreme-rate scenarios.
🧩 Part
📌 Control
🎯 Goal
Index (e.g., CMT/SOFR)
Market-driven
Understand, don’t chase
Margin
Negotiable
Lower is better
Periodic/ Lifetime Caps
Negotiable range
Limit worst-case rates
How do I leverage the “next-birthday” rule to increase proceeds?
If closing occurs within 6 months of your next birthday, lenders may use the higher age for the principal limit factor. A one-month delay can add thousands in proceeds—ask for side-by-side estimates.
🎂 Timing Window
🧠 Advantage
🗓️ Tactic
< 6 months to birthday
Higher age factor
Schedule counseling now, close just after eligibility date
> 6 months
No effect
Optimize rate/fees instead
Do proprietary (jumbo) loans protect a non-borrowing spouse like HECMs?
Protections are contractual, not federal. Some jumbo programs mimic NBS occupancy rights; others do not. Demand written survivorship/occupancy language, and have an elder-law attorney review it before committing.
💎 Topic
✅ Require in Writing
🚫 Avoid
NBS occupancy rights
Post-maturity residency allowance
Vague “case-by-case” promises
Non-recourse
Liability limited to home
Full-recourse or silence
Servicing continuity
Named servicer + transfer conditions
Open-ended transfer rights
Condo approvals: will my HOA’s finances kill the deal?
Underwriters review budget adequacy, reserves, insurance, owner-occupancy, and litigation. Thin reserves or unresolved lawsuits often stall HECMs. Ask the HOA for a lender package before you order the appraisal.
🏢 Metric
🔎 Underwriter Focus
✅ Cure Path
Reserves
% of budget to reserves
Provide latest reserve study
Insurance
Master + fidelity
Update certificates
Litigation
Nature & scope
Counsel letter explaining risk
Owner-occupancy
Too many rentals
Provide updated roster
Moving to assisted living—can I keep the HECM while I transition?
A temporary absence under 12 months for medical reasons can preserve eligibility if the home remains your principal residence and obligations are met. Two borrowers? One occupant can maintain the test.
🧳 Situation
🧠 Eligibility
✅ Steps
Solo borrower, short rehab
Likely okay
Keep utilities/mail at home; respond to occupancy certs
One of two borrowers away
Still okay
Co-borrower continues occupancy
Indefinite move
Maturity risk
Discuss options with servicer early
Appraisal low—can I challenge the value used for proceeds?
Yes. Submit a Reconsideration of Value (ROV) with comparable sales that are closer, more recent, and similar in features. Be specific—square footage, condition, view, and lot adjustments must be evidence-based.
🧮 ROV Ingredient
📎 Evidence
🙂 Best Practice
Better comps
MLS sheets, photos
Within 0.5–1.0 mile, 3–6 months
Feature match
Renovation receipts
Emphasize like-for-like
Condition
Contractor reports
Avoid emotional language—stick to facts
Builder incentives with HECM for Purchase (H4P)—what’s allowed?
FHA allows certain seller concessions, but no inducements to borrow that distort the net purchase price. Credits must be on the Closing Disclosure. Illegal or undisclosed incentives can void the loan.
🧱 Incentive
✅ Generally Okay
🚫 Risky
Closing cost credits
Disclosed & capped
Off-book “side deals”
Upgrades
Priced into contract
Post-close reimbursements
Rate buydowns
If disclosed and compliant
Tied “must use” third parties
Broker vs. direct lender—who gives the safer experience?
Brokers shop multiple investors and can win on margin; direct lenders control underwriting and often servicing (if retained). Choose based on servicing plan, fee transparency, and net proceeds, not the logo on the business card.
🧭 Channel
💪 Strength
⚠️ Watch
Broker
More product access
Who services the loan later?
Direct lender
Process control
Only one rate sheet
How do I avoid reverse-mortgage impostor scams?
Scammers mimic servicers and demand “occupancy fees,” “insurance audits,” or wire instructions. Never click unknown links or wire funds from email alone. Call the published servicer number to verify any request.
🕵️ Scam Type
🚫 Red Flag
✅ Safe Move
Phishing email/text
Urgent payment link
Call servicer on statement number
Deed/Transfer scam
Quitclaim docs by email
Attorney review before signing
“Government partner” ad
Claims affiliation
Verify via HUD lender list
Right of rescission—do I get one with every reverse mortgage?
HECMs have a 3-day rescission after signing exceptHECM for Purchase (H4P), which has no rescission (purchase loans fund at closing). Plan decisions accordingly.
📜 Loan Type
🔄 Rescission?
🗓️ Window
HECM (refi/standard)
Yes
Midnight of 3rd business day
H4P (purchase)
No
Final at closing
What’s the cleanest payoff strategy when selling the home?
Request a written payoff quote good through your projected closing date; confirm per diem interest, recording fees, and any recoverable corporate advances. Your settlement agent will wire funds and request the release of lien.
🏁 Step
✅ Action
🙂 Tip
1
Order payoff 2–3 weeks ahead
Include sale date & contact
2
Review fees line-by-line
Ask about “corporate advances”
3
Confirm lien release timeline
Track recording to avoid delays
If heirs need more time, how do extensions actually work?
After maturity, the servicer typically allows 6 months, with up to two additional 3-month extensions for good cause. Show listing agreements, loan approvals, or contractor timelines to justify more time.
⏳ Extension Type
📎 Proof That Wins
🧭 Use Case
First 3-month
Active listing + showings
Market time
Second 3-month
Pending sale or refi approval
Closing pipeline
Hardship
Medical/estate delays
Document thoroughly
Can I lock in a reverse mortgage rate like a forward mortgage?
Yes, but HECM rate locks are shorter and more conditional. Closing delays (counseling timing, condo docs, repairs) can push you outside the lock. Control the paperwork critical path to protect pricing.
🔒 Lock Risk
🧠 Prevention
✅ Owner Task
Counseling date slips
Book early
Get certificate upfront
Appraisal backlog
Order quickly
Prep home access & comps
Repair conditions
Cure fast
Pre-bid and schedule contractors
What does an “Aging-in-Place” budget look like around a HECM?
Pair tenure payments or LOC draws with a LESA and earmark home-mod funds (grab bars, lighting, ramps). The goal is to prevent T&I defaults and reduce fall risk simultaneously.