Put the Equity You’ve Built to Work for You
Most homeowners spend decades building equity — paying down their mortgage month after month, year after year. A reverse mortgage gives eligible borrowers a way to access that equity as usable funds during their retirement years, without the requirement of a monthly mortgage payment and without having to sell the home they’ve lived in and loved.
If you have an existing mortgage, the reverse mortgage can pay it off entirely — eliminating that monthly payment from your budget. Any equity that remains after the existing mortgage is paid off becomes available to you to use however you choose: supplementing retirement income, covering healthcare expenses, making home improvements, or simply maintaining greater financial flexibility in your day-to-day life.
It’s not the right solution for everyone, and it’s important to understand all of the details before moving forward. Our team will walk you through exactly how a reverse mortgage works, what the costs involve, and whether it aligns with your financial situation and long-term goals — with no pressure to proceed.
A reverse mortgage is a specialized home loan available to homeowners who are 62 years of age or older. The most common type is the Home Equity Conversion Mortgage, or HECM — a program insured by the Federal Housing Administration (FHA) under the U.S. Department of Housing and Urban Development.
Unlike a traditional mortgage — where you make monthly payments to a lender to pay down a loan balance over time — a reverse mortgage works in the opposite direction. The lender makes payments to you, or provides access to a line of credit, drawing against the equity in your home. The loan balance grows over time as interest accrues, and repayment is not required as long as you continue to live in the home as your primary residence, keep up with property taxes and insurance, and maintain the property.
The loan becomes due when the last borrower permanently leaves the home — whether through sale, relocation, or passing. At that point, the home is typically sold and the proceeds are used to repay the loan balance, including accrued interest and fees. If the home sells for more than the loan balance, the remaining equity goes to the borrower or their estate. Because HECM loans are FHA-insured, borrowers are protected from owing more than the home’s value at the time of repayment — known as the non-recourse feature.
At NEXA Lending, we take a transparent, no-pressure approach to reverse mortgage consultations. We’ll make sure you and your family fully understand the program before making any decisions.
The Reverse Mortgage Process
Answer a few questions about your age, your home’s estimated value, your current mortgage balance (if any), and what you’re hoping to accomplish. We’ll use that information to give you a preliminary picture of what you may qualify for.
Before a HECM reverse mortgage can proceed, all borrowers are required by federal law to complete a counseling session with an independent, HUD-approved housing counselor. This session is designed to make sure you fully understand the loan terms, costs, obligations, and alternatives. It typically takes about an hour and can be done by phone or in person.
After counseling is complete, we’ll put together your reverse mortgage options based on your home’s appraised value, your age, and current interest rates. You’ll see a clear breakdown of how much equity you can access, what the associated costs are, and how the loan balance is projected to grow over time.
Once you’ve reviewed your options and decided to move forward, you’ll choose how you want to receive your funds. After closing, your elected disbursement method goes into effect. You can change your disbursement method at any time after closing, giving you flexibility to adjust as your needs evolve.
(A) At the conclusion of the reverse mortgage loan term, some or all of the equity in the property that is the subject of the reverse mortgage may no longer belong to the borrower. The borrower may need to sell or transfer the property to repay the loan proceeds, or must otherwise repay the reverse mortgage with interest using other assets.
(B) The lender will charge an origination fee, a mortgage insurance premium, closing costs, and/or servicing fees for the reverse mortgage. All or any of these charges may be added to the outstanding loan balance by the lender.
(C) The balance of the reverse mortgage loan increases over time, and the lender charges interest on the full outstanding loan balance.
(D) The borrower retains title to the property that is the subject of the reverse mortgage until the property is sold or transferred, and is therefore responsible for paying property taxes, homeowner’s insurance, maintenance costs, and any related assessments. Failure to meet these obligations may cause the reverse mortgage loan to become immediately due and may subject the property to a tax lien, other encumbrance, or possible foreclosure.
(E) Interest accrued on a reverse mortgage is not deductible from the borrower’s income tax return until the borrower repays all or part of the reverse mortgage loan.
Reverse mortgages involve important financial and estate planning considerations, and it’s completely normal to have questions — for yourself or on behalf of a family member. Our team is available around the clock to walk you through how the program works, what the obligations are, and whether a reverse mortgage makes sense given your specific situation and goals. We take a transparent, no-pressure approach to every conversation.
