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Reverse Mortgages After a Borrower's Death: Choices for Heirs

A reverse mortgage affects the decisions a family must make after the borrower dies. Keeping the home, selling it, and resolving the loan balance require information about the property, the contract, and any surviving spouse. Discuss the arrangement in advance when possible, and contact the servicer promptly so deadlines do not make the decision for you.

The questions below use selected Consumer Financial Protection Bureau guidance, adapted and organized by Fynoptic. Source links and the dates displayed by those sources are provided at the end.

What happens to my reverse mortgage when I die?

Reverse mortgage loans typically must be repaid, usually by selling the home, when the last borrower dies. However, non-borrowing spouses may be able to stay in the home if they meet certain criteria.

Most reverse mortgages today are Home Equity Conversion Mortgages (HECMs). What happens to these reverse mortgages will depend on several factors, including:

  • Whether you have a co-borrower on the reverse mortgage loan,
  • When you took out the reverse mortgage, and
  • Whether you were married to your spouse when you signed the loan documents and you and your spouse continued to be married up until your death.

Learn more about reverse mortgages.

If there’s a co-borrower on the loan

When there is a co-borrower on the loan, both you and the co-borrower receive the benefits of the loan and are responsible for meeting the obligations of the loan. If one borrower dies, the co-borrower will be able to remain in the home and receive loan payments as long as they meet the obligations of the reverse mortgage loan.

It’s a good idea to check with your reverse mortgage servicer to make sure your loan records are accurate and that you and your co-borrower are both on the loan. Call your servicer to find out what names are listed on your loan. See your reverse mortgage loan statement for the servicer’s phone number or address and ask them to send you this information in writing for your records.

If your spouse is not a co-borrower

Your non-borrowing spouse may stay in the home if they pay off the loan. They may also be able to stay in the home without paying off the loan, depending on when the loan was taken out and whether they qualify as an Eligible Non-Borrowing Spouse under U.S. Department of Housing and Urban Development (HUD) rules. An Eligible Non-Borrowing Spouse will not get any money from the reverse mortgage. The process of qualifying to be an Eligible Non-Borrowing Spouse may be difficult. Your non-borrowing spouse may want to get help from an attorney or a HUD-approved housing counseling agency.

For HECMs with Federal Housing Administration (FHA) case numbers assigned on or after August 4, 2014

After you die or move into a healthcare facility for more than 12 consecutive months, your lender or servicer will determine if your non-borrowing spouse qualifies under HUD’s rules to stay in the home. Under HUD’s rules, to qualify as an Eligible Non-Borrowing Spouse, your spouse must:

  • Have been married to you at the time the loan documents were signed, and stay married to you up until your death. If you and your spouse were a same-sex couple and were unable to be legally married at the time the reverse mortgage loan was made, your spouse must show that you were legally married to each other at the time of your death.
  • Have been identified in the loan documents as a non-borrowing spouse.
  • Have lived in the home at loan closing and continue to live in the home as their principal residence after you die or move into a healthcare facility for more than 12 consecutive months.
  • Continue to meet the loan requirements and make sure the loan does not become due and payable for any other reason.

For HECMs with FHA case numbers assigned before August 4, 2014

After you die or move into a healthcare facility for more than more than 12 consecutive months, your lender or servicer can choose to either:

Enter a process called “Mortgage Optional Election (MOE) Assignment” that allows an Eligible Non-Borrowing Spouse to stay in the home. To qualify as an Eligible Non-Borrowing Spouse, your spouse must:

  • Have been married to you at the time the loan documents were signed, and stay married to you up until your death. If you and your spouse were a same-sex couple and were unable to be legally married at the time the reverse mortgage loan was made, your spouse must show that you were legally married to each other at the time of your death.
  • Have lived in the home at the time of the loan was taken out and continue to live in the home as their principal residence after you die or move into a healthcare facility for more than 12 consecutive months.
  • Provide their Social Security number or Tax Identification Number.
  • Agree that they will no longer receive any payments from the reverse mortgage loan.
  • Continue to meet the loan requirements and make sure the loan does not become due and payable for any other reason.

Foreclose on the home. If your lender or servicer decides to foreclose on your home or finds that your non-borrowing spouse does not qualify for MOE Assignment, they must begin foreclosure proceedings within six months of your death. If your non-borrowing spouse is actively trying to sell the property or satisfy the debt in some other way, your non-borrowing spouse may request a delay of the foreclosure for up to 180 days.

If you have heirs

If your heirs want to keep your home after you and your Eligible Non-Borrowing Spouse die, your heirs will have to repay either the full loan balance or 95 percent of the home’s appraised value – whichever is less.

Prepare any non-borrowing family members living in the home by deciding together what they will do after you die. Learn more about heirs’ options when you have a reverse mortgage.

With a reverse mortgage loan, can my heirs keep or sell my home after I die?

It depends on whether there are coborrowers or an eligible nonborrowing spouse. If there are neither, to keep the home, heirs must pay the full loan balance. To sell it, they must repay the full loan balance, or at least 95 percent of its appraised value if the loan balance owed is more than the home value.

A reverse mortgage loan becomes due and payable after your death and after the death of any coborrowers or of an eligible nonborrowing spouse. Once your heirs receive a due and payable notice from the lender, they have 30 days to buy, sell, or turn the home over to the lender to satisfy the debt. This is the case for Home Equity Conversion Mortgages (HECMs), which are the most common type of reverse mortgage loan.

However, it might be possible for the timeline to be extended up to six months so your heirs can sell the home or obtain their own loan to purchase the home. Your heirs can consult a HUD-approved housing counseling agency or an attorney for more information.

What if my heirs need to sell a home that has a reverse mortgage?

Your heirs might not have the money pay off the loan balance when it is due and payable, so they might need to sell the home to repay the reverse mortgage loan.

When the loan is due and payable, your home might be worth more than the amount owed on the reverse mortgage. This means your heirs can sell the home, use the money to repay the loan, and keep the difference.

Or, when the loan is due and payable, your home might be worth less than the amount owed on the reverse mortgage. This means your heirs can pay off the loan by selling the home for at least 95 percent of the home’s appraised value. The rest of the loan is covered by the mortgage insurance that the reverse mortgage borrower paid during the duration of the loan.

What if my heirs want to keep a home that has a reverse mortgage?

When the loan is due and payable, your heirs can pay off the balance of the reverse mortgage and stay in the home. They might need to get a loan of their own to finance the purchase.

How to prepare

If you have a reverse mortgage loan and want to leave your home to your children, it’s important to talk to them now about their repayment options. You may also want to consider talking to a professional about creating an estate plan.

What happens if my reverse mortgage loan balance grows larger than the value of my home?

If your loan balance is more than the value of your home, you or your heirs may not have to pay the difference.

If you owe more than your home is worth, but sell your home for the appraised fair market value, the remaining balance will be paid by mortgage insurance.

When the last remaining borrower passes away, the loan has to be repaid. Most heirs will repay the loan by selling the home. If your loan balance is more than the value of your home, your heirs won’t have to pay more than 95 percent of the appraised value. The remaining balance of the loan is covered by mortgage insurance.

Note: This information only applies to Home Equity Conversion Mortgages (HECMs), which are the most common type of reverse mortgage loan.


What happens if I have a reverse mortgage and I want to sell my home?

When you sell your home your reverse mortgage loan will need to be paid back.

If you decide to sell your home while you have a reverse mortgage loan, you will have to pay back the money you borrowed plus interest and fees.

  • If your loan balance is less than the amount you sell your home for, then you keep the difference.
  • If your loan balance is more than the amount you sell your home for and you sell your home for the appraised value, the money from the sale will go towards the outstanding loan balance and any remaining balance of the loan is paid for by mortgage insurance.
  • If your reverse mortgage loan is in default and you’ve received a notice that the loan is “due and payable,” you may sell your home for 95 percent of its appraised value. The money from the sale will then go towards the outstanding loan balance and any remaining balance of the loan is paid for by mortgage insurance.

Note: This information only applies to Home Equity Conversion Mortgages (HECMs), which are the most common type of reverse mortgage loan.

Sources and further reading

The CFPB source passages are U.S. government work in the public domain. Fynoptic has selected, organized, and adapted the material for this guide, including corrections identified through the additional sources listed above. Sources accessed October 27, 2026. This use does not imply agency endorsement or affiliation.

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