Home Equity Without a Required Monthly Mortgage Payment
An FHA-insured Home Equity Conversion Mortgage lets homeowners 62 and older borrow against their home while staying in it. There is no required monthly principal-and-interest payment, but property taxes, insurance, upkeep and occupancy obligations continue. Understand all of it before counseling.
A reverse mortgage converts part of your equity into funds you can use, while the loan balance grows over time. Every point below comes from HUD or CFPB program descriptions, not from a sales pitch.
💰
No Required Monthly Mortgage Payment
You are not required to make monthly principal-and-interest payments. Interest and mortgage insurance are added to the balance instead. Property taxes, homeowners insurance and any HOA dues are still yours to pay.
🏠
You Keep Title
The home stays in your name. The reverse mortgage is a lien, like any mortgage. You can sell whenever you choose and repay the loan from the sale.
💳
Payout Choices
A line of credit you draw as needed, fixed monthly payments for a term or for as long as you live in the home, a lump sum, or a combination. A line of credit costs less over time than a lump sum because you pay interest only on what you draw.
💪
FHA-Insured and Non-Recourse
When the loan is repaid by selling the home, you or your estate will not owe more than the home is worth at that time. FHA insurance covers any shortfall. The mortgage insurance premiums pay for that protection.
📋
HUD Counseling Comes First
Before the loan you meet with a HUD-approved reverse mortgage counselor who explains how it works, what it costs, what you must keep doing and what the alternatives are. The counselor works for you.
⚖
Loan Advances, Not Income
Proceeds are generally not treated as income. Needs-based benefits such as Medicaid or SSI look at assets, so funds held in an account can matter. Talk to a benefits counselor and a tax advisor before you draw.
Before the Conversation
Who a HECM Is For, and How the Borrowing Limit Is Set
Eligibility is defined by HUD. The amount you can borrow is a calculation, not a negotiation.
Borrower and Property
What HUD Requires
The youngest borrower is at least 62
The home is your principal residence, where you live most of the year
You own the home outright or the balance is small enough to pay off at closing
You complete counseling with a HUD-approved agency before the loan
A financial assessment shows you can keep paying taxes, insurance and upkeep
The home is in acceptable condition; required repairs are identified before approval
Delinquent federal debt, such as federal taxes or student loans, is resolved
Set-asides. If the financial assessment finds the budget tight, part of the proceeds may be set aside to pay taxes and insurance. That lowers what is available to you but is what keeps the loan in good standing.
The Principal Limit
Three Inputs
The age of the youngest borrower or eligible non-borrowing spouse
The expected interest rate on the loan
The lesser of your home's appraised value and the FHA maximum claim amount
The 2026 Maximum Claim Amount
$1,249,125 for FHA case numbers assigned January 1 through December 31, 2026, in every area, per HUD Mortgagee Letter 2025-22
Older borrowers, lower expected rates and higher values produce a higher principal limit. HUD publishes the factor tables lenders use; this page does not reproduce them or estimate your number. Ask for the written proposal and bring it to counseling.
Your Obligations
The Payment Stops. The Responsibilities Do Not.
The Consumer Financial Protection Bureau lists what a reverse mortgage borrower must keep doing. Missing any of them can make the loan due and payable and can lead to foreclosure.
Pay property taxes when they are due
Keep homeowners insurance in force, and flood insurance where required
Pay homeowners association or condominium dues where they exist
Keep the home in good repair
Live in the home as your principal residence and confirm occupancy when your servicer asks
Tell your servicer before an extended absence, such as a long hospital or care stay
The balance is due and payable when the last borrower or eligible non-borrowing spouse dies, sells the home, or no longer lives in it as a principal residence, or if the obligations above are not met.
Heirs can keep the home by repaying the balance or, when the balance exceeds the value, by paying 95 percent of the appraised value. They can sell and keep any difference, or turn the home over to the lender. The CFPB describes a 30-day response window with extensions available for up to six months.
Non-borrowing spouse. A spouse who is not on the loan may be able to remain in the home under HUD's eligible non-borrowing spouse conditions but cannot draw more funds. Settle this in counseling and before closing.
Reverse Mortgage Costs
What a HECM Costs, Line by Line
Most of these can be paid from the loan rather than out of pocket. That lowers what is available to you and grows the balance faster, because interest and insurance then accrue on the financed costs too.
Cost
How It Is Set
Source
Initial mortgage insurance premium
2% of the maximum claim amount, paid to FHA at closing
HUD Mortgagee Letter 2017-12
Annual mortgage insurance premium
0.5% of the outstanding balance, added to the loan over time
HUD Mortgagee Letter 2017-12; CFPB
Origination fee
Paid to the lender, capped by HUD at $6,000 or less
CFPB
Third-party closing costs
Appraisal, title search and insurance, surveys, inspections, recording fees, credit report
CFPB
Counseling fee
A reasonable fee set by the HUD-approved agency; not charged if you cannot afford it
CFPB
Servicing fee
May be charged monthly and added to the balance; ask whether one applies
CFPB
Interest
Accrues on the balance, including financed costs and prior interest
CFPB
Why the Balance Grows Faster Than You Expect
Each month, interest and the annual mortgage insurance premium are added to the balance, and the next month's charges are calculated on that larger balance. Borrowing only what you need, or choosing a line of credit over a lump sum, keeps the compounding smaller. Dollar amounts for the appraisal, title and other third-party costs are quoted for your file, not on this page.
Comparison
Reverse Mortgage vs. HELOC
Both borrow against home equity. They fit different situations, and one of them requires monthly payments.
Feature
Reverse Mortgage (HECM)
HELOC
Monthly payment
None required; interest and insurance accrue
Required during the draw and repayment periods
Age requirement
62 or older
None
Repayment trigger
Death, sale or leaving the principal residence
Scheduled monthly payments
Government insurance
✓ FHA insured
✗ Not insured
Non-recourse
✓ You or your estate will not owe more than the home is worth when sold
✗ Full recourse
Payout options
Line of credit, term or tenure payments, lump sum, or a mix
Revolving credit line
Upfront cost
Higher, including an FHA mortgage insurance premium
Neither column quotes rates, fees or limits for your file. Counseling covers the alternatives, including selling or a HELOC.
The Arithmetic
Principal Limit, Costs and What Is Left Are Three Different Numbers
Enter the principal limit a lender or counselor quoted you, your payoff and the costs you were quoted. The worksheet subtracts. It does not estimate what you qualify for, and the defaults are assumed figures used only to show the arithmetic.
Your estimate, not the FHA appraisal
An assumed figure until a lender or counselor gives you yours
Paid from proceeds at closing
Assumed; use your written quote
From the financial assessment
Arithmetic Only
Illustrated Amount Available After Payoff and Costs
$83,000
Principal Limit You Entered$180,000
Less: Initial MIP (2% of the lesser of value and $1,249,125)−$8,000
Subtraction on the figures you entered. The principal limit for your file comes from HUD's tables, your age, the expected rate and the appraised value. HUD rules may limit how much can be drawn in the first year. Not an approval or a quote.
The Process
What the Process Looks Like
Counseling comes first by rule. The rest follows the same sequence as other FHA loans, with a financial assessment added.
1
Conversation and HUD Counseling
Required first
Talk with us about the goal, then complete a session with a HUD-approved reverse mortgage counselor, by phone or in person. You receive a counseling certificate that the file needs.
2
Application and FHA Appraisal
Your documents
Submit the application with income, asset and property documents. An FHA appraiser values the home and notes any repairs that must be addressed.
3
Financial Assessment and Underwriting
Full file
Underwriting reviews credit history, income, expenses and property charges to confirm you can keep paying taxes and insurance. If the budget is tight, a set-aside for those charges may be required.
4
Closing, Rescission and Funding
Signing
You sign the closing documents. On a HECM that is not a purchase, a rescission period follows before funds are disbursed. Any existing mortgage is paid off from the proceeds and your chosen payout begins.
Frequently Asked Questions
Reverse Mortgage FAQs
Straight answers about eligibility, costs, obligations, spouses and heirs, drawn from HUD and CFPB program descriptions.
Texana Bank Mortgage uses a soft credit inquiry for the initial review, which does not affect your credit score. A hard inquiry only occurs later if you move forward with a full application.
A Home Equity Conversion Mortgage, or HECM, is an FHA-insured loan for homeowners age 62 and older that lets you borrow against your home equity without a required monthly principal-and-interest payment. Interest and mortgage insurance are added to the balance over time. The loan becomes due when the last borrower or eligible non-borrowing spouse dies, sells the home or no longer lives there as a principal residence.
Yes. Title stays in your name, and the reverse mortgage is a lien like any other mortgage. You can sell at any time and repay the loan from the proceeds. What you must keep doing is paying property taxes and homeowners insurance, maintaining the home and living in it as your principal residence.
The Consumer Financial Protection Bureau lists them plainly: continue to pay property taxes and homeowners insurance, keep the home in good repair and use it as your principal residence. Homeowners association dues and flood insurance apply where they exist. If those obligations are not met, the loan can be called due and the lender can foreclose.
The youngest borrower must be at least 62. The home must be your principal residence, owned outright or with a balance small enough to pay off at closing from your funds or the loan proceeds. You must complete counseling with a HUD-approved agency before the loan, pass a financial assessment showing you can keep up taxes and insurance, and the home must be in acceptable condition. Delinquent federal debt must be resolved.
The principal limit depends on the age of the youngest borrower or eligible non-borrowing spouse, the expected interest rate and the lesser of your home value and the FHA maximum claim amount, which is $1,249,125 for FHA case numbers assigned in calendar year 2026. Older borrowers, lower rates and higher values produce a higher limit. This page does not publish a factor table; a written proposal from a lender and your counselor show the number for your file.
HECM proceeds can be taken as a line of credit you draw as needed, as fixed monthly payments for a set term or for as long as you live in the home, as a single lump sum, or as a combination. A line of credit costs less over time than a lump sum because you pay interest and insurance only on what you draw. The unused portion of a line of credit grows.
An initial FHA mortgage insurance premium of 2% of the maximum claim amount, an annual mortgage insurance premium of 0.5% of the outstanding balance added to the loan, an origination fee capped by HUD, third-party closing costs such as the appraisal, title and recording, a counseling fee, interest and possibly a monthly servicing fee. Most costs can be paid from the loan, which lowers what is available to you and grows the balance faster.
A HECM is a non-recourse loan. When the loan is repaid by selling the home, you or your estate will not owe more than the home is worth at that time. FHA insurance covers the shortfall. That protection is one of the things the initial and annual mortgage insurance premiums pay for.
A spouse who is a co-borrower keeps the loan and the protections. A spouse who is not a borrower may be able to remain in the home as an eligible non-borrowing spouse if the HUD conditions are met, but cannot draw additional funds. Raise this in counseling and with us before closing, not after.
When the last borrower or eligible non-borrowing spouse dies, the loan becomes due and payable. Heirs can keep the home by repaying the balance or, when the balance is higher than the value, by paying 95 percent of the appraised value. They can also sell and keep any difference, or turn the home over to the lender. The CFPB describes a 30-day response window with extensions available for up to six months to arrange a sale or financing.
Loan advances are generally not treated as income, and Social Security and Medicare are not needs-based. Needs-based programs such as Medicaid or Supplemental Security Income look at assets, so proceeds held in a bank account can matter. Ask a benefits counselor and a tax advisor before you draw funds.
The HECM for Purchase program lets an eligible buyer age 62 or older combine a large cash investment with a reverse mortgage to buy a new principal residence without a required monthly mortgage payment. The required investment is set by the program for your file, so ask for it in writing.
Before a HECM, you must complete a session with a HUD-approved reverse mortgage counseling agency. The session covers how the loan works, its costs, your obligations and the alternatives. Agencies may charge a reasonable fee, and the CFPB notes they cannot charge you if you cannot afford it. Bring your questions; the counselor works for you, not for the lender.
Yes. You can make voluntary payments at any time or repay the loan in full without a prepayment penalty. Some borrowers make occasional payments to keep the balance from growing while keeping the flexibility of no required monthly payment.
Counseling comes first, then the application, the FHA appraisal, the financial assessment and underwriting, then closing. On a HECM that is not a purchase, a rescission period follows signing before funds are disbursed. The pace depends on counseling availability, the appraisal and how quickly documents arrive. We do not promise a closing date on a web page.
I had an excellent experience working with my texana bank mortgage from start to finish. They were extremely professional, knowledgeable, responsive, and made the entire mortgage process feel much easier than I expected.
They took the time to explain everything clearly, answered all of my questions, and kept me informed throughout the entire process. I always felt like I had someone in my corner who genuinely cared about helping me reach my goals.
If you’re looking for a mortgage broker who is trustworthy, dependable, and willing to go the extra mile for their clients, I highly recommend them. I truly appreciate all of their hard work and would definitely work with them again!
K
Kent Sisco
★★★★★
Adam McCormick is fantastic! Easy to work with and keep me informed every step of the way! Looking forward to working with him again in the future
A
Andrea Ferrell
★★★★★
Adam was phenomenal from start to finish! He was friendly and professional. He assisted me every step of the way, walking me through the process with ease. He was always there for whatever questions I had. He was very, very patient and always reached out to me in a timely manner if I contacted him and he was unavailable at the time. Moreover, he made me feel as if he cared for more than just my loan, but me as a person!!! Texana is blessed to have him as an associate!!
Andrea
C
Clay Ragsdale
★★★★★
Where to really start. Adam walked me through everything and put me at ease. I have had some bad experiences with other companies so I was digging and looking for any red flag. There was none with him and his direct talk is what did it for me. Someone that is real and just says what it is. No false hope or misdirection at anytime.
I would recommend him to anyone and definitely Someone looking for honesty and caring. The communication is top notch and a true professional.
Respectfully,
Clay
B
Belvia Lynn
★★★★★
My overall experience while working with Adam McCormick was excellent. He was very pleasant and professional.
J
Joseph Hardman
★★★★★
Adam McCormick is an absolute professional in every sense of the word. I will NEVER use any other loan officer for my financials other than Adam as long as he is in the business. His work as my loan officer was exceptional. Throughout the process, he always responded to an e-mail, responded to a text, called right back if not answering immediately. He always made you feel as though you were his only client. There was never the impression he had more important things to do other than speak with you. He worked with us through a death in the family, personal issues, and numerous other challenges. It's possible other loan officers would have given up on us during this process, but Adam stuck with us through it all. His work ethic is amazing. He is an expert in his craft. I could not possibly give a higher recommendation, he has redefined what right looks like in this business.
M
Marsha Kessler-Bradshaw
★★★★★
I was about to go with another company for this refinance no cash out until I received a call from this Adam McCormick. He was so knowledgeable and made me feel very comfortable with this process. Adam is knowledgeable ,courteous, understanding and has a real passion and patience for people. 👍We are at the closing. Thank you Adam McCormick!!
P
Peter Jenkins
★★★★★
My situation had its difficulties. Justin was confident and persistent through the process and we the got the result
D
Dale Samuel
★★★★★
Mark has been very professional and has been very respectful to my wife and myself.
Mark has shown that genuine human qualities and really worked with us and for us.
This actually been a pleasure to get to know Mark.
J
James Fields
★★★★★
Outstanding Service and support from a truly Customer Oriented Agent! My pleasure to have worked with Mr. MCcormick.! Would follow him to next source if necessary. He is concerned in an outstanding balanced way. My pleasure to?know and do Business with him and The Bank!
JFields
R
Rose Stone-Stewart
★★★★★
Texana Bank was there for us throughout the entire process. Their personableness, as well, their professionalism. As a financial institution it was nice to know that while obtaining a loan, we had a safe place to relay. They are absolutely “by the book” and at the same time makes the process easier to participate. The hospitality and genuine concern as clients was overwhelming of which we will always consider Texana Bank first, before mostly any other financial institution.
M
Mitchell Morris
★★★★★
Greg was awesome and the process was simple. I have nothing but the highest praise for the process and for Greg himself. Thank you.
R
Ronald Bylsma
★★★★★
Best refi experience of our lives, Andre was very knowledgeable and always kept us calm when things got stressful. Would recommend Mr. Andre Floyd to anyone looking for a great lending officer!
D
Dejan Jajcevic
★★★★★
I’ve worked with mini bankers before and I used to do them over a decade ago myself and my experience that I had with Chad was nothing short of phenomenal. He is a wonderful Banker does a very diligent job and did not miss any moments of reassuring me where my loan was and closing I couldn’t say enough good things about him and I hope if I ever need to go through this stressful process again he is still in business to take care of me
J
James Reaves
★★★★★
Adam is awesome super friendly easy to work with always aware of what’s going on and keeps you informed which is great.
L
Lesli Hopkins
★★★★★
Lynette is absolutely awesome to work with! She takes the time to make you comfortable with the process and answers any questions completely and accurately
B
Bobby Strickland
★★★★★
Andre Floyd was ABSOLUTELY AMAZING. I just love working with him.
A
Abraham Sanchez
★★★★★
Working with Greg Darlin has been an awesome experience. An honest and sincere individual. He is to the point and very very knowledgeable. I appreciate the fact that he didn’t try to give me the run around and through the entire process I learned a few things. Thank you.
Understand It Before You Sign It
We will explain the obligations, the costs and the payout choices in plain language, put the proposal in writing and help you schedule HUD counseling. No pressure, and no number promised on a web page.
