Age

• To qualify for a reverse mortgage, all of the homeowners must be 62 years or older. If one homeowner is 65, and qualifies, but the spouse is only 60, they must wait until the spouse turns 62 years old. The homeowners do not have to retire from their current jobs and begin collecting Social Security; they just have to be old enough to do so. There isn't a maximum age limit either. A homeowner who is 99 may get a reverse mortgage just like a homeowner who is 62.
  
  

Counseling

• The Federal Housing Administration knows unethical people target the elderly more than someone who is not a senior citizen. To help protect seniors who obtain a reverse mortgage, the FHA requires the homeowners complete reverse mortgage counseling as a condition of the loan approval. This counseling discloses all of the available ways they can set up a reverse mortgage and explains the program in detail. The counselor also can verify the fees charged by the lender do not exceed the maximum allowed or discriminate against the homeowner because of their employment, age or disability.
  
  

Ownership

• The FHA does require the homeowner occupy the home as a primary residence. If the homeowner moves into a retirement or assisted living facility, the reverse mortgage must be refinanced. This doesn't mean the homeowner cannot travel extensively for business or pleasure. The homeowner may even not occupy the home for months at a time, as long as it is still the homeowner's primary residence. If the homeowner sells the home, he must pay off the reverse mortgage balance at closing. If the homeowner dies, he can pass on the property to his heirs. The heirs would have to refinance the home within a reasonable time however.
  
  

Income Received

• The FHA created the HECM program to help retired-aged seniors have more flexibility and additional cash for their retirement. The home must have substantial equity to receive cash back each month. The homeowner may choose to receive a lump sum at close, a fixed amount paid monthly for the life of the loan or obtain a credit line that may be accessed as the homeowner wishes. The homeowner may also choose to combine these options and receive a lump sum up front and a line of credit or fixed monthly amount of income. Since this money comes from a loan, the IRS does not consider it taxable.