Is It Hard to Qualify for a Reverse Mortgage?

Reverse mortgages can sound too good to be true — you get to stay in your home, you receive monthly payments, and you don’t have to pay toward the balance of the loan during your lifetime. For many people, reverse mortgages (HECM) are an integral part of their retirement planning. But how hard is it to qualify?

In many cases, qualifying for a reverse mortgage is a lot easier than you’d think. There are strict age and residency requirements, but when it comes to income and credit scores, lenders tend to be lenient. Here’s what it takes to qualify.

Qualifying for a HECM: The Basics

Most reverse mortgages are classified as Home Equity Conversion Mortgages (or HECMs for short). These mortgages are insured by the Federal Housing Administration (FHA), and the FHA has established these basic eligibility criteria:

You Must Be at Least 62

Reverse mortgages are specifically designed to help older homeowners stay in their homes as they age. For that reason, you can only qualify if you are 62 or older. There is no upper age limit for getting a reverse mortgage.

The Property Must Be Your Primary Residence

You can only get a reverse mortgage for your principal residence — not an investment property or vacation home. You also must keep the home as your primary residence throughout the life of the loan.

How Hard Is It Really to Qualify?

For most homeowners, qualifying for a reverse mortgage is far easier than qualifying for a traditional loan.
There’s no need to show high income, have a perfect credit score, or prove employment — because you aren’t making monthly payments.

Instead, the lender mainly cares about two things:

• You have enough equity in your home
• You can keep up with property taxes, insurance, and maintenance

That’s it. If you’ve been a responsible homeowner for years, there’s a strong chance you already meet the basic requirements.

You Must Have Significant Equity or Own the Home Outright

When you take out a reverse mortgage, you are effectively converting some of your equity into cash. If you have very little equity in your home, you are unlikely to qualify. The smaller the remaining balance on your mortgage, the more equity you have.

You Must Not Be Delinquent on Federal Debt

If you have unpaid back taxes or are delinquent on another kind of federal debt, you likely will not qualify for a HECM.

You Must Be Able to Handle the Costs of Homeownership

Reverse mortgage contracts require you to handle routine maintenance of your home and to pay the various costs associated with owning a home. These include property taxes, homeowners’ insurance, and homeowners’ association fees (if applicable).

You Must Complete Counseling

The FHA approves certain people and organizations to counsel HECM applicants. Before you apply, you must attend loan counseling to ensure you fully understand the reverse mortgage process and any potential risks.

What Credit Score Requirements Do You Have to Meet?

There are no specific credit score requirements to qualify for a HECM. Because reverse mortgages are secured by your home, lenders are often very lenient when it comes to evaluating credit scores.

Although there are no specific credit score requirements, you must meet the following credit history requirements to be approved:

• All housing/installment debt payments have been made on time over the last 12 months
• You’ve had no more than two late housing/installment debt payments over the last 24 months
• You haven’t had any credit card payments more than 90 days late over the past 12 months
• You’ve had no more than three credit card payments made 60 days late

If you fall slightly short of the credit requirements, don’t automatically assume you can’t qualify for a reverse mortgage. The FHA itself asks lenders to think about how a HECM could help alleviate their financial difficulties when deciding whether to approve the loan or not.

If there were extenuating circumstances that have negatively impacted your credit history, your lender may be able to approve you anyway.

Common Reasons Applicants Are Denied

While the approval process is flexible, there are still a few reasons a reverse mortgage might be denied:

• Not enough equity: If your mortgage balance is too high, you may not qualify until more of it’s paid down or your home value increases.
• Unpaid federal debts: Back taxes or student loans can disqualify you until resolved.
• Poor property condition: Major safety or structural issues must be repaired before approval.
• Failure to meet residency requirements: The property must remain your primary home.

If you’re unsure whether any of these apply, South River Mortgage can review your situation and help you plan next steps — often, these issues can be fixed before applying.

What About Income?

Income requirements for reverse mortgages tend to be less strict than those for other kinds of debt. However, if you aren’t familiar with the application process, it can be somewhat confusing to determine whether your income qualifies.

HECM lenders look at what’s called your “residual income” when evaluating your application. To get your residual income, you subtract your monthly expenses from your monthly income.

Your residual income must meet a specific threshold for your state and family size. If you aren’t sure whether you qualify or not, our team can review your situation with you and determine whether your residual income meets HECM requirements.

What If You Don’t Qualify Right Now?

Even if you don’t qualify immediately, that doesn’t mean you’re out of options.
Some of the most common solutions include:

• Paying down your existing mortgage to build equity faster.
• Refinancing into a smaller home to free up more equity.
• Resolving small credit issues or paying off federal debts.
• Adding a co-borrower (like a spouse) who meets the age and residency requirements.

Our team frequently helps homeowners create a roadmap to qualification — sometimes in just a few months. Knowing what’s holding you back can make all the difference.

How Lenders Evaluate Your Financial Situation

The FHA doesn’t require a high income to qualify — but it does want to ensure you can afford ongoing home expenses.

That’s why the Financial Assessment was introduced in 2015. It’s not a credit score test or income test in the traditional sense — it’s simply a way for lenders to confirm that you can:

• Pay property taxes and insurance on time
• Maintain the home in good condition
• Cover basic living expenses after closing

If your finances are tight, the lender may still approve your loan with a set-aside account — funds reserved from your reverse mortgage proceeds to automatically cover taxes and insurance. This ensures you stay compliant and worry-free.

Want to Find Out Whether You Qualify?

The world of reverse mortgages can be confusing, but you don’t have to navigate it alone. The team at South River Mortgage is here to help you understand whether a HECM is right for you. If it is, we’ll help connect you with the right lender.

Get an instant quote here today (totally free) to get started. Then call 855-212-9114 to discuss your options with our licensed reverse mortgage experts. They will answer all your questions, no pressure or obligation.

FAQ – Qualifying for a Reverse Mortgage

Can I get a reverse mortgage if I still have a traditional mortgage?

Yes. You just need enough home equity to pay off your existing mortgage balance with the proceeds from your reverse mortgage.

Do both spouses have to be 62 or older?

Only one borrower must be 62 or older, but the younger spouse will need to be listed as a “non-borrowing spouse” to remain protected.

Will poor credit automatically disqualify me?

No. Reverse mortgages are based more on home equity and financial stability than credit scores. Extenuating circumstances are often considered.

Can I qualify if my income is limited to Social Security?

Yes, as long as your residual income meets FHA’s guidelines for your region and household size.

How fast can I get approved?

Once your counseling and documentation are complete, many loans close within 30–45 days.