How does a spouse qualify for the deferral?

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Reverse mortgage question

How does an eligible non-borrowing spouse (NBS) qualify for the deferral period?

On a HECM with a case number assigned on or after August 4, 2014, an eligible non-borrowing spouse can stay in the home after the last borrower dies through what HUD calls the deferral period. To qualify, the spouse must have been married to the borrower at closing and stayed married, been disclosed and named in the loan documents, and lived in the home as their primary residence. To keep the deferral, they must keep living there and continue to pay property taxes and homeowners insurance, maintain the home, and meet the other loan terms. Since 2021, the spouse no longer has to prove they hold title or a legal right to stay, which the old 90-day rule required.

When a HECM borrower dies, the loan normally comes due. The deferral period is the exception HUD created for a husband or wife who isn't on the loan. If that spouse qualifies, the lender waits, and the spouse gets to stay home.

Here's how a spouse qualifies, and how they keep it.

Who qualifies for the deferral period

On a HECM with an FHA case number assigned on or after August 4, 2014, the spouse must:

Have been married to the borrower when the loan closed, and stayed married for the rest of the borrower's life.
Have been disclosed to the lender at closing and named as an eligible non-borrowing spouse in the loan documents. That also means the spouse's age was used to figure how much money the loan provided.
Have lived in the home as their primary residence, and keep living there.

The spouse also attends counseling with the borrower before the loan closes.

A spouse who was identified at closing but didn't meet these requirements, for example because they didn't live in the home, is an ineligible non-borrowing spouse and doesn't get the deferral. See What is an ineligible non-borrowing spouse?

What the spouse has to do after the borrower dies

When the last borrower dies, the servicer will ask the spouse to certify that they:

Were married to the borrower until the borrower's death.
Still live in the home as their primary residence.
Are meeting the other loan terms.

After that, the spouse confirms they still qualify once a year. HUD lets the servicer accept that annual certification in writing, electronically, or by phone.

How the spouse keeps the deferral

The deferral lasts as long as the spouse:

Keeps living in the home as their primary residence.
Continues to pay property taxes and homeowners insurance, maintains the home, and meets the other loan terms, including HOA dues where they apply.
Keeps the loan out of default for any other reason.

When the spouse dies or moves out for good, the deferral ends and the loan comes due. Then the rules for heirs apply. See Reverse Mortgages and Heirs.

The part couples need to plan for

The deferral protects the home. It doesn't keep the money flowing.

During the deferral period, no more money is paid out of the loan. Monthly payments stop, and an unused line of credit can't be drawn. So the surviving spouse needs a plan to cover property taxes, insurance, upkeep, and everyday living costs without the reverse mortgage.

This is the conversation I spend the most time on with couples where one spouse is younger. I'd rather we figure it out at the kitchen table now than have the surviving spouse figure it out alone later.

What changed since the old rules

If you read our older answer to this question, it said the spouse had to get legal ownership of the home, or some other legal right to stay, within 90 days of the borrower's death. That's no longer true. HUD removed that requirement for all HECMs in 2021. Probate often takes longer than 90 days, and the old rule put spouses in a bind.

Other changes since the deferral began in 2014:

2021: The deferral can also apply when the borrower has lived in a health care facility, like a nursing home, for more than 12 consecutive months, as long as the spouse still lives in the home.
2023: HUD set out how servicers confirm the spouse's status each year, and that they may ask for a divorce decree if there's a divorce.

What about loans from before August 4, 2014?

The 2014 deferral doesn't apply automatically to older loans. But a surviving spouse may still be able to stay through a Mortgagee Optional Election (MOE) assignment, where the lender assigns the loan to HUD at its option. The lender doesn't have to choose it, and the loan can't be in default for another reason, like unpaid property taxes. If that's your situation, call the servicer right away and ask about MOE.

If one of you is under 62, let's run the numbers both ways before you decide. Call us at 530-888-6000, or get your estimate.

Sources

HUD Mortgagee Letter 2021-11, May 6, 2021: hud.gov
HUD Mortgagee Letter 2023-23, November 30, 2023: hud.gov
HUD HECM Borrower and Non-Borrowing Spouse Certifications, revised October 31, 2023: hud.gov
HUD Mortgagee Letter 2011-31, HECM counseling certificate: hud.gov

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).