Reverse mortgages in California, explained plainly.

What a Reverse Mortgage Actually Is

A reverse mortgage is a federally regulated loan that lets an eligible homeowner borrow against the equity they've built in their home. Unlike a traditional mortgage, the lender pays the borrower — as a lump sum, a line of credit, monthly draws, or some combination — and the balance is repaid when the borrower sells the home, permanently moves out, or passes away.

The most common product is the Home Equity Conversion Mortgage (HECM), insured by the FHA. For higher-value California properties above the federal HECM limit, proprietary ("jumbo") reverse mortgages can lend against values up to $4 million or more.

Who Qualifies

• Borrowers must generally be 62 or older (some proprietary programs allow 55+).
• The home must be your primary residence — single-family, FHA-approved condo, townhouse, 2–4 unit where you occupy one, or manufactured home meeting FHA standards.
• You must have substantial equity — typically 50% or more.
• You must complete HUD-approved reverse mortgage counseling before we can process the loan.
• You must demonstrate ability to meet the ongoing property-charge obligations — taxes, insurance, HOA dues, and maintenance.

How You Can Receive the Money

Depending on the program and your rate selection, you can take proceeds as:

• Lump sum at closing (fixed-rate HECM)
• Line of credit that grows over time at the same rate as the note — often the most powerful option
• Tenure payments — fixed monthly payments for as long as you live in the home
• Term payments — fixed monthly payments over a set number of years
• Modified — combine a line of credit with monthly payments

HECM for Purchase — Buying With a Reverse Mortgage

One of the most underused tools in retirement planning. HECM for Purchase lets borrowers 62+ buy a new primary residence using a reverse mortgage — combining a meaningful down payment (typically 45–65% depending on age and rates) with reverse mortgage proceeds, and carrying no required monthly mortgage payment on the balance.

This is often how retirees right-size — selling a larger California home, downsizing into a single-story or age-appropriate property, and keeping more cash in the bank than a traditional purchase would allow.

Impact on Your Heirs

When the loan comes due, your heirs have options:

• Sell the home — pay off the reverse mortgage, keep any equity above the loan balance.
• Keep the home — pay off the balance or 95% of appraised value, whichever is less.
• Deed the home to the lender — walk away with no further obligation, even if the loan exceeds the home's value.

Heirs are never personally liable for any shortfall — that's the non-recourse protection built into every HECM. The FHA insurance fund covers any gap.

What You're Still Responsible For

A reverse mortgage is not free money. You remain responsible for:

• Property taxes (California Proposition 13 protections continue to apply if you qualify)
• Homeowners insurance
• HOA dues, if applicable
• Reasonable maintenance of the home
• Continuing to live in the home as your primary residence

Closing costs mirror traditional loans plus the FHA upfront Mortgage Insurance Premium — most can be financed into the loan, meaning little to no out-of-pocket expense at closing.

Making the Right Choice

Often a good fit if: you plan to stay in your home long-term, want to eliminate an existing mortgage payment, need to supplement retirement income, or want a growing safety net.

Probably not a good fit if: you plan to move within a few years, or are being pressured to take a reverse mortgage to fund an annuity or investment product. That last one is a red flag — walk away.

Why Work With Curt

Reverse mortgages reward patience and expertise. Product selection, rate timing, payout structure, LESA decisions, non-borrowing spouse documentation — the details compound. Curt has originated reverse mortgages for California homeowners across every product generation, compares HECM against proprietary jumbo programs when your property value warrants it, and coordinates with your CPA and estate attorney when they're part of the conversation.