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Reverse mortgage guide
Before any HECM, you meet with an independent, HUD-approved counselor, and during that session the counselor asks you ten questions to check that you understand the loan. Under HUD's counseling protocol, you need to answer at least five of the ten correctly to get your counseling certificate in that first session. If you don't, the counselor holds the certificate and offers another session, a call back, or more time to learn. Below are the questions counselors choose from, with plain-English answers, so nothing in your session catches you off guard.
A lot of people dread counseling. They picture a test with a stern proctor and a red pen. It's really not like that. It's a conversation with an independent counselor whose only job is to make sure you understand what you're signing up for.
But there is a little quiz built in. Did you know the counselor has to ask you ten questions during the session to check your understanding? It's true. This article walks through how that works, the questions counselors pick from, and what a solid answer sounds like for each one.
A reverse mortgage is a big decision, and HUD wants every HECM borrower to hear the whole story from someone with no stake in the outcome. The counselor must work for an agency that isn't associated with or paid by anyone who originates, services, or funds your loan.
That independence is the point. The counselor will walk you through how the loan works, what it costs, what you're still responsible for, and the alternatives, like selling, downsizing, or local programs that might help. If they think a reverse mortgage isn't right for you, they'll say so. Honestly, I like that. I'd rather you hear it from them than find out later.
See Reverse Mortgage Counseling for how to find an agency and schedule.
Every borrower attends. So does a non-borrowing spouse, and anyone else on title who won't be a borrower. If your spouse isn't going to be on the loan, this matters a lot. Read the Non-Borrowing Spouse guide before you go.
Family members and trusted advisors are welcome. I encourage it. A second set of ears helps, and it means your kids hear the same thing you hear.
You can generally choose a phone session or a face-to-face session, unless your state doesn't allow phone counseling. Most of my clients do it by phone from their kitchen table.
Plan on about an hour to an hour and a half. Have your mortgage statement, your property tax bill, and any loan estimate you've received nearby.
Agencies can charge a fee, but it has to be reasonable for the service, and they can't turn you away just because you can't pay. In many cases the fee is paid at closing. Ask the agency up front.
Somewhere during the session, usually spread throughout rather than all at the end, the counselor asks you ten questions from a standard list. They're checking that you understood what they explained, not trying to trip you up.
You need to answer at least five of the ten correctly to get your certificate in that session. Read that again, because a lot of people have it backwards. Five wrong still passes. It's when you can't get five right that the counselor holds the certificate.
It happens, and it's fine. The counselor writes down that the certificate was withheld and why, and then offers you options:
If you still can't answer five correctly, the counselor can't issue the certificate yet, but you can come back for another session when you're ready. If you're nervous, call me before your session and we'll go over these together.
The counselor picks ten from a list like the one below. My answers are written the way I'd explain them at the kitchen table. Your counselor may word things a little differently, and that's fine.
You do. Your name stays on the title or deed. The lender has a lien on the home, just like with a regular mortgage. You can sell whenever you want. See Do I still own my home if I get a reverse mortgage?
This one's personal, so there's no single right answer. The counselor wants to hear that you know your choices:
On an adjustable HECM, you can generally change your payment plan later for a small fee. A fixed-rate HECM is a single lump sum at closing. If you don't know why you picked the option you picked, that's a sign we haven't talked enough yet. See Comparing Fixed and Adjustable Reverse Mortgages.
No. 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. You can make voluntary payments if you want to, and they lower your balance.
The counselor is listening for the second half of that answer. If you only say there's no payment, expect a follow-up question.
Yes. It's a loan, not a gift. Interest and mortgage insurance are added to the balance over time, and the whole balance is repaid when the loan comes due.
When the last borrower dies, sells the home, or moves out for good. Moving out includes being away from the home for more than 12 consecutive months for health reasons. It can also come due if you don't meet the loan terms, like paying property taxes and insurance. If you have an eligible non-borrowing spouse, they may be able to stay after you're gone.
You must:
If you fall behind, the lender can pay the bill and add it to your balance, and eventually the loan can be called due, which can lead to foreclosure. This is the most important answer on the list. It's also why the lender reviews your finances before approving the loan. See Reverse Mortgage Financial Assessment.
Yes, you can stay as long as you keep meeting the loan terms. Running out of loan money doesn't make the loan come due. But you'll still need income to pay taxes, insurance, and upkeep. That's why I'm careful about taking a big lump sum and spending it fast.
No to both. A HECM is non-recourse. You can stay in the home as long as you meet the loan terms, even if the balance passes the home's value. When the home is sold, you and your heirs don't pay the difference. FHA insurance covers it.
The balance grows over time, so there's generally less equity left for your heirs. When the loan comes due, they can sell the home and keep what's left after the loan is repaid, keep the home by paying off the loan, or turn it over to the lender. If the home is worth less than the balance, they generally don't have to pay more than 95 percent of its appraised value to keep or sell it. See Reverse Mortgages and Heirs.
If you sell and move, the loan is repaid from the sale. You'd have less money from the sale than if you had no loan, because the balance, with its interest and mortgage insurance, comes off the top first. If you think you may move in a few years, that's a reason to think hard about the upfront costs.
If you're refinancing an existing HECM into a new one, you may be asked these. See Reverse Mortgage Refinance.
Yes. The new HECM has FHA mortgage insurance too. On a HECM-to-HECM refinance, you generally get credit for the upfront premium you paid on your current HECM, which lowers the new upfront premium. How much depends on the two loans. See Reverse Mortgage Costs.
A new origination fee, appraisal, title, and other closing costs. The refinance has to make sense after those costs, which is why HUD has rules on how much a HECM refinance has to benefit you.
If you're buying a home with a reverse mortgage, you may be asked these. See HECM for Purchase.
The new one. The HECM is placed on the home you're buying, and you must move into it as your primary residence, generally within 60 days of closing.
The lender subtracts the HECM's principal limit from the purchase price plus closing costs. The difference is your down payment. It can come from the sale of your current home, savings, or other assets you document. The seller can pay some closing costs within HUD's limits, and if you or a family member is the agent on the sale, that commission can count too.
Because the home has to meet FHA's property standards, and because you're buying a home you'll likely live in for the rest of your life. An inspection tells you what you're getting before you commit.
Good ones: Do you know how a HECM for Purchase works? Can the contract allow FHA's appraisal and repair requirements? How will we handle the timeline if I'm selling my current home? Our page for real estate agents covers what they need to know.
When you pass, you'll receive a Certificate of HECM Counseling. Each borrower and the counselor sign it, and others who had to attend may need to sign too. It's good for 180 days after counseling is completed. If your loan takes longer than that, you'll need to counsel again. See When does a counseling certificate expire?
If your home is in California, there's one more step: state law requires a waiting period between counseling and when a lender can accept your final and complete application. See Why do I need to wait 7 days after counseling to apply in California?
Not really in the way people fear. If you can't answer five of the ten questions correctly, the counselor holds the certificate and offers another session, a call back, or more time. Most people pass easily when they've prepared.
Yes. Family members and trusted advisors are welcome, and I encourage it.
Yes. HUD requires non-borrowing spouses to receive counseling too.
Generally yes, unless your state requires face-to-face.
You do. Your lender or broker gives you a list of HUD-approved agencies, and you choose. See Reverse Mortgage Counseling.
Usually yes. It can be waived on a HECM-to-HECM refinance only when certain HUD conditions are met. See Is counseling required for HECM to HECM refinances?
The certificate can't be withheld because you can't pay, and agencies may waive or reduce fees. Ask the agency.
All borrowers, plus any non-borrowing spouse and non-borrowing owners. See Who must attend counseling?
Our goal is to educate first. If you want to go through these questions before your session, I'm happy to do it with you and your family. Get your estimate or call us at 530-888-6000.
ZYNG Mortgage, Inc., NMLS #76801. A reverse mortgage has no required monthly mortgage payments and uses your home's equity. Fees, mortgage insurance and other costs can be added to the loan balance, and the balance grows over time as interest is added, so your equity typically decreases. When the loan becomes due, the home may need to be sold, or the loan repaid from other funds. Interest is not tax-deductible until it is paid, in part or in full. You keep title to your home and must keep paying property taxes, homeowners insurance and upkeep, and meet the other loan terms; not doing so can make the loan due and could lead to foreclosure.
This material is not from HUD or FHA and was not approved by HUD or a government agency.
HECM count at the top of this page: HUD data through September 2026 (source, opens in a new tab).
