Reverse mortgage guide
Reverse Mortgage Requirements: The California Checklist
Three requirements get you in the door. Two more steps get you to closing. Here is everything a lender checks, plus the rules California adds on top.
The three major requirements for a reverse mortgage are that you're at least 62, you have enough equity in the home, and the home is your primary residence. On top of those, a HECM requires a session with a HUD-approved counselor and a financial assessment by the lender. And yes, you can get a reverse mortgage in California. The state just adds a few extra protections.
For how the loan works, what it pays out and how the Orange County home values stack up against the HECM limit, see my page on reverse mortgages in Orange County. This guide is the checklist.
Requirement 1: age 62 or older
For a HECM, the youngest borrower on the loan has to be at least 62. Age also drives the math. The older the youngest borrower, the larger the share of the home's value you can access.
If one spouse is 62 or older and the other isn't, you can still do the loan. The younger spouse is listed as a non-borrowing spouse. More on that below, because the details matter.
Some proprietary reverse mortgages, the jumbo products offered by private lenders, accept borrowers younger than 62 in certain states. Availability changes, so I check it case by case.
Requirement 2: enough equity
There isn't a single published percentage. The real test is simple: the reverse mortgage has to be large enough to pay off any existing mortgage and liens at closing, plus the closing costs, with the loan proceeds. If it can't, you'd need to bring cash in to close the gap.
In North Orange County this is rarely the obstacle. Most of the clients I meet in Yorba Linda, Placentia and Anaheim Hills bought decades ago and owe little or nothing. The more common issue here runs the other way. For 2026 the HECM maximum claim amount is $1,249,125, and a HECM calculates your proceeds on the lower of the appraised value or that limit.
Illustration: a Villa Park home appraised at $2,200,000 with a $300,000 mortgage. The HECM only "sees" $1,249,125 of that value. It can still work, but a jumbo reverse, which uses more of the value, may get you further. I run both.
Requirement 3: it's your primary residence
You have to live in the home most of the year and keep it as your principal residence for the life of the loan. Vacation homes and rentals don't qualify.
Eligible property types for a HECM: - Single-family homes. - 2 to 4 unit properties, as long as you live in one of the units. - Condominiums in an FHA-approved project, or a unit that qualifies for FHA's single-unit approval. - Townhomes and PUDs. - Manufactured homes built after June 15, 1976, on a permanent foundation, that meet FHA's standards. Many older mobile homes on leased land don't.
Co-ops generally don't qualify for a HECM. If the house needs major repairs, the appraiser will flag them and some can be completed after closing from a set-aside.
Requirement 4: HUD-approved counseling
Before a lender can take a HECM application, you meet with a counselor approved by HUD. The counselor is independent. They don't work for me, and they don't work for the lender. They walk through how the loan works, the costs, your obligations, what happens to your heirs and whether something else might fit better, like a HELOC, a sale, or a local assistance program.
You can find one through HUD's counselor search. The session usually runs about an hour, and many are done by phone. You'll get a certificate at the end. Bring your heirs if you want them there. Counselors are used to it.
I like it when clients go in with numbers already in hand. I'll give you a comparison of options first, so the counseling session is about your actual situation instead of a generic one.
Requirement 5: the financial assessment
Since 2015, HECM lenders look at whether you can keep up with the bills that stay with you after closing: property taxes, homeowners insurance, HOA dues and upkeep. It's not a traditional income qualification. There's no debt-to-income cutoff that knocks you out the way a regular mortgage has.
What the lender reviews: - Credit history, especially your record on housing payments, taxes and insurance. - Residual income, meaning what's left each month after your regular expenses, measured against a guideline that depends on household size and region. - Property charge history, whether taxes and insurance have been paid on time.
If the assessment raises a concern, it doesn't always mean no. The lender may require a Life Expectancy Set-Aside, or LESA. Part of your proceeds is held back and used to pay your property taxes and insurance for you. That reduces the cash you can draw, but it also means those bills are handled.
One more hard stop: delinquent federal debt, like a defaulted federal student loan or unpaid federal taxes, has to be resolved or on a payment plan before closing.
Non-borrowing spouses
This is the rule I spend the most time on with couples, because the old version of it hurt people.
If your spouse is under 62, they can be an eligible non-borrowing spouse. To be protected, they generally must be married to you at closing, be named in the loan documents, and keep living in the home as their primary residence. If you pass away first, repayment is deferred and your spouse can stay in the house as long as they keep meeting the loan's obligations.
Two tradeoffs. First, the younger spouse's age is used to calculate the loan amount, so a big age gap means less money available. Second, a non-borrowing spouse can't draw new funds after you're gone. If they'd need that line of credit, waiting until they turn 62 and adding them as a borrower may be the better plan.
What California adds
California law layers a few protections on top of the federal ones.
- Counseling first, then a waiting period. A lender can't accept a completed reverse mortgage application or charge you fees until 7 days after you finish counseling.
- A worksheet before you commit. California requires a reverse mortgage worksheet that walks you through questions about your goals and alternatives. It's meant to be reviewed during or before counseling.
- No tying to other products. A lender can't make buying an annuity or insurance a condition of the reverse mortgage.
Federal rules also give you a three-business-day right to cancel after closing on most reverse mortgages that aren't used to buy a home.
What to have ready
- A photo ID and Social Security number for each borrower and any non-borrowing spouse.
- Your current mortgage statement, if you have one.
- Your homeowners insurance declarations page and latest property tax bill.
- HOA contact information, if you have an HOA.
- Income documents: Social Security award letter, pension statements, retirement account statements.
- Your HUD counseling certificate, once you have it.
Meeting the requirements vs. whether you should
Qualifying and being a good fit aren't the same thing. The requirements only tell you whether a lender can say yes. Whether you should say yes is a separate question, and it comes down to how long you'll stay, how you feel about the balance growing, and what you want to leave behind. I wrote that side up in reverse mortgage pros and cons. If you're planning to move rather than stay, HECM for Purchase has its own set of rules.
I spent seventeen years at Chase and have been in this business since 2002. The part of this job I care about most with clients over 62 is that nobody walks out of my office surprised later.
Questions people ask
What are the three major requirements for a reverse mortgage?
You must be at least 62, you must have enough equity for the reverse mortgage to pay off any existing mortgage at closing, and the home must be your primary residence. For a HECM, you also complete counseling with a HUD-approved counselor and pass a financial assessment.
Can you get a reverse mortgage in California?
Yes. HECMs and proprietary (jumbo) reverse mortgages are both available in California. The state adds its own consumer protections, including a waiting period between counseling and a completed application and a required worksheet that walks you through the tradeoffs.
What is HECM counseling, and how long does it take?
It's a session with a HUD-approved counselor who is independent of the lender and the broker. It usually runs about an hour, by phone, video or in person. The counselor covers costs, alternatives and your obligations, then issues a certificate that the lender needs before it can move forward.
Can my younger spouse stay in the house if I pass away?
Usually, yes. A spouse under 62 can be listed as an eligible non-borrowing spouse. If they were married to you at closing, are named in the loan documents and keep living in the home as their primary residence, repayment can be deferred while they stay. They can't draw new funds, and their age lowers the amount available at closing.
What credit score do I need for a reverse mortgage?
HECMs don't have a minimum credit score. The lender looks at your credit history and whether you've paid property taxes, insurance and other housing bills on time. A rough history doesn't automatically disqualify you, but it can lead to a set-aside for future taxes and insurance.
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