Santa Ana Reverse Mortgages and Home Loans

If you live in a condo or a townhome, a reverse mortgage conversation changes. With a single-family house, the questions are mostly about you: your age, your equity, your budget. With a condo, there's a second set of questions about the building and the HOA, and those can make or break the loan.

So this page starts with the basics, then spends real time on condos, HOAs, and California's balcony inspection law, because that's where most surprises come from.

The short version

• We help with reverse mortgages and regular home loans for Santa Ana and Orange County homes, through our California loan officers.
• A HECM can pay off your mortgage and give you access to equity, with no required monthly mortgage payments. You must continue to pay property taxes and homeowners insurance, maintain the home, and meet the other loan terms.
• Condos need FHA approval for a HECM, either for the whole project or for your single unit. Some proprietary programs may accept others.
• HOA dues and special assessments count in the lender's review of your budget.
• California makes you wait 7 days after counseling before a reverse mortgage application is final.

Reverse mortgages for Santa Ana homeowners

The HECM

The HECM is the FHA-insured reverse mortgage. You must be 62 or older, live in the home as your primary residence, and have enough equity. If you still owe on the home, the HECM pays that off first. What's left can be a line of credit, monthly payments, a lump sum, or a mix.

There are no required monthly mortgage payments. You must continue to pay property taxes and homeowners insurance, maintain the home, and meet the other loan terms.

Proprietary (jumbo) reverse mortgages

Orange County home values often run above the HECM limit. When they do, a jumbo reverse mortgage may give you access to more. We compare programs including Mutual of Omaha Secure Equity, Finance of America HomeSafe, Longbridge Platinum, Smartfi Choice, Nationwide Equities EquityPower, and MCM Holdings MCM Edge, and availability varies by state. HomeSafe Standard is approved in California. See Lending Limits.

The HECM for Purchase

If you're ready to move, the HECM for Purchase lets you buy your next home with a down payment and a reverse mortgage for the rest. After closing, there are no required monthly mortgage payments. You must continue to pay property taxes and homeowners insurance, maintain the home, and meet the other loan terms.

Condos and townhomes: what to check first

Is it a condo or a PUD?

Not every townhome is a condo. Many are part of a planned unit development, where you own the land under your unit. A PUD generally doesn't need FHA condo approval for a HECM. A condo does. Your grant deed or HOA documents will usually tell you which you have.

FHA approval: the whole project or just your unit

For a condo HECM, there are two paths:

1. The project is FHA-approved. Then the unit can generally move forward.
2. The unit gets single-unit approval. FHA allowed this for HECMs starting in 2019. The project still has to meet standards, including limits on how many units already have FHA loans, how many are owner-occupied, and how much space is commercial.

Things that can slow down or stop a condo HECM:

• An HOA budget or reserves that don't meet FHA's standards.
• Pending lawsuits involving the association.
• A large share of units used as rentals.
• Big special assessments, current or planned.

If your condo can't get FHA approval, some proprietary programs may accept it, depending on the program. That's one of the first things I'll check.

HOA dues are part of your budget

Before approving a HECM, the lender completes a financial assessment. It looks at your income, your credit, and your history of paying property charges, which include HOA dues and special assessments, not just property taxes and insurance. Falling behind on HOA dues can put the loan at risk too, so build them into your plan.

California's balcony inspection law (SB 326)

This one deserves its own section, because it's hitting a lot of Orange County condo owners in the wallet.

In 2019, California passed SB 326, which added Civil Code section 5551. It requires condo associations with buildings of three or more attached units to have a licensed structural or civil engineer, or an architect, inspect balconies, decks, stairways, walkways, and railings that are supported by wood and more than six feet off the ground:

• The inspection happens every nine years.
• The first round was due by the end of 2024.
• The results go into the association's reserve study.

Why does this matter for a reverse mortgage? Because repairs found in those inspections often turn into special assessments or higher dues. Those are property charges. If your association is facing a big repair bill, the lender will want to know, and so will you, before you plan a budget around the loan.

Before we talk, ask your HOA for:

• The most recent reserve study.
• The balcony inspection report, if your building needed one.
• Any notice of a special assessment, current or proposed.

Prop 19 if you're moving within California

If you're 55 or older, Prop 19 lets you transfer the taxable value of the home you sell to a replacement home anywhere in California, up to three times, if you buy within two years. If the new home costs more, the difference is added. In Orange County, you file with the Orange County Assessor using form BOE-19-B.

That can pair well with a HECM for Purchase if you're moving from a house to a condo, or from Orange County to somewhere quieter. Talk with the assessor and your tax professional before you list.

California rules every reverse mortgage borrower should know

The 7-day wait after counseling

Before any HECM, you meet with an independent, HUD-approved counselor. California then makes you wait: a lender can't accept your final, complete reverse mortgage application, or charge you fees, until 7 days after counseling. Read Why do I need to wait 7 days after counseling?

The notice and the worksheet

California requires a notice in large type before counseling, and a worksheet that you and the counselor sign. The loan can't be approved until the lender has the signed worksheet.

No required annuities

California law bars a lender from requiring you to buy an annuity to get a reverse mortgage.

Prop 13 stays with you

A reverse mortgage is a loan, not a change in ownership, so it doesn't reset your Prop 13 assessment.

Property Tax Postponement

California's Property Tax Postponement program doesn't accept a home with a reverse mortgage, and getting one makes any postponed taxes due. If you're in the program, tell me first.

Insurance

You must keep homeowners insurance on the home, and for a condo, the HOA's master policy matters too. If you've ended up on the California FAIR Plan, that's fine. The lenders we work with accept a FAIR Plan policy paired with a difference-in-conditions policy.

Home loans for Santa Ana buyers and owners

We also help with:

• Buying a home and seeing your buying power before you shop.
• Refinancing.
• Home equity loans and HELOCs.
• FHA loans, conventional loans, and jumbo loans.
• VA loans for eligible veterans and service members.

Request a rate quote for your numbers.

How we work with Santa Ana clients

1. A conversation by phone or video, including a first look at your condo's status if you have one.
2. Counseling with an independent, HUD-approved counselor, then California's 7-day wait.
3. Application, appraisal, and condo review.
4. Signing at home with a mobile notary, or at escrow on a purchase.

Santa Ana and Orange County resources

• Orange County Office on Aging, the county's Area Agency on Aging: Information and Assistance line 800-510-2020
• Orange County Assessor: Prop 19 claim form (BOE-19-B)
• California State Board of Equalization: Prop 19
• HUD-approved housing counselors: hud.gov/counseling or (800) 569-4287

Common questions

Can I get a reverse mortgage on a condo in Santa Ana?

Often, yes, if the project is FHA-approved or your unit can get single-unit approval. If not, some proprietary programs may accept it.

Do HOA dues affect a reverse mortgage?

Yes. They're a property charge, and the lender includes them in the financial assessment.

What if my HOA has a big special assessment coming?

Tell me early. It's part of your property charges, and it can affect both the approval and your budget.

What is SB 326, and does it affect me?

It's California's balcony inspection law for associations with three or more units. If your building has wood-supported balconies or walkways above six feet, the HOA has to inspect them every nine years, and repairs can lead to special assessments.

Will a reverse mortgage reassess my property taxes?

No. It's a loan, not a change in ownership.

Next step

Get My Estimate, find a loan officer for California, or call us at 530-888-6000. See our California page, the Los Angeles page, and the full guide to Reverse Mortgages.

Sources

• HUD, FHA Reverse Mortgage for Seniors (HECM): hud.gov
• HUD Mortgagee Letter 2019-17, summarized by Hinshaw & Culbertson: hinshawlaw.com
• "SB 326: The Balcony Bill," Epsten: epsten.com
• California State Board of Equalization, Introduction to Prop 19: boe.ca.gov
• California State Controller's Office, Property Tax Postponement FAQ: sco.ca.gov
• California Civil Code section 1923.2: justia.com
• California Civil Code section 1923.5: findlaw.com
• Orange County Office on Aging, FAQs: officeonaging.oc.gov