Reverse mortgages: What homeowners should know in 2026
September 24, 2026
A reverse mortgage can help an eligible older homeowner access home equity without selling the property. It can support retirement income, pay off an existing mortgage, or provide funds for planned expenses. The tradeoff is that the loan balance typically grows over time. Careful planning is essential before moving forward.
The most common reverse mortgage is the federally insured Home Equity Conversion Mortgage, often called a HECM. Depending on the program, proceeds may be available through a line of credit, monthly advances, a lump sum, or a combination of options. The homeowner keeps title to the property and generally does not make monthly principal and interest payments. Interest and mortgage insurance charges are added to the balance. The loan usually becomes due when the last eligible borrower sells the home, moves out permanently, or dies.
Borrowers must continue paying property taxes, homeowners insurance, and any applicable association charges. They must also maintain the home and use it as their principal residence. Required counseling provides an independent review of the loan, its alternatives, and the borrower's responsibilities. Closing costs and ongoing charges should be weighed against the expected benefit. A reverse mortgage can be useful, but it is not free access to equity.