HUD reverse mortgages can help retirees get extra cash. Through a HUD reverse mortgage, seniors can access home equity without making payments.

HUD Reverse Mortgage Eligibility

HUD reverse mortgage applicants must meet the following criteria:

• Homeowner must be 62+.

• The home must be owned free and clear (or have a balance that can be paid from equity).

• Must be a primary residence.

• The property must be a single-family home, a one-to-four unit dwelling with one unit occupied by the applicant, a mobile home, a condo or PUD unit

• Property standards must be met.

Qualifying homeowners can receive a lump sum, monthly payments, or a line of credit, or a combination of those options. Changing circumstances can later restructure payment options.

HUD Reverse Mortgage Guidelines

The HUD reverse mortgage loan amount is based on the following criteria:

• Borrower's Age: Older borrowers can borrow more against their home's value.

• The loan interest rate: And of course, the lower loan interest rates allow you to borrow more money.

• Home value: There is no hard limit on home value for a HUD reverse mortgage, but the amount that can be borrowed is capped by FHA mortgage limits for an area. High-priced homeowners can't borrow more than FHA-limit homeowners.

• Reverse mortgage borrowers have no asset or income limits.

As long as the home is the borrower's primary residence, a HUD reverse mortgage isn't repaid. When the home is sold, the mortgage company recovers its principal and interest, and the rest goes to the homeowner or his or her survivors. HUD will cover any shortfall if sales proceeds don't cover the debt.

FHA, part of HUD, collects an insurance premium from all borrowers to provide coverage. Mortgage companies usually pay for this insurance and add it to the borrower's principal. FHA reverse mortgage insurance can make HUD's program cheaper than private programs without insurance.