Reverse mortgages: turning home equity into income
A federally insured reverse mortgage (HECM) lets a homeowner 62 or older borrow against their home without monthly mortgage payments, as long as they live there and keep up taxes and insurance. For 2026, the most home value FHA will lend against is $1,249,125. Massachusetts requires approved counseling before closing and gives you seven days after accepting the lender's commitment before you are bound.
The numbers
| Minimum age (youngest borrower or spouse) | 62 |
| 2026 HECM maximum claim amount | $1,249,125 (case numbers on/after 1 Jan 2026) |
| 2025 limit, for comparison | $1,209,750 |
| MA waiting period after accepting the commitment | 7 days |
| MA minimum borrower age for reverse mortgages | 60 (state law); 62 for a federal HECM |
How it works
The loan is repaid when the last borrower dies, sells or moves out. You must keep paying property taxes, homeowner's insurance and upkeep; falling behind can lead to foreclosure. Reverse mortgage money is a loan, not income.
Counseling required
Federal law requires counseling from an independent HUD-approved counselor before a HECM. Massachusetts law also says a lender cannot make a reverse mortgage until you complete a counseling program approved by the state's Executive Office of Aging and Independence. Counseling may be in person, by live video, or by phone. A reverse mortgage made without this counseling is unenforceable under Massachusetts law.
Massachusetts protections
Under Massachusetts law, you are not bound for seven days after you accept the lender's written commitment in writing, which gives you time to reconsider.
Effect on MassHealth
If you might need MassHealth nursing-home coverage later, be careful what you do with the money. MassHealth treats reverse mortgage or home equity loan money that is given away for less than fair value as a disqualifying transfer. Talk to an elder law attorney before borrowing.
Mistakes families make
- Skipping taxes or insurance after closing; this is the most common cause of reverse mortgage default.
- Not planning for a younger spouse who is not on the loan.
- Paying for counseling or 'reverse mortgage information'. HUD counseling is free or low cost; HUD warns of scams.
Who to call on Cape Cod
| Who | Number | For |
|---|---|---|
| HUD housing counselor locator | (800) 569-4287 | Find a HUD-approved HECM counselor |
| SHINE — Cape & Islands | (508) 375-6762 | Free, unbiased help with Medicare, MassHealth and plan choices |
What we could not confirm: Massachusetts does not require counseling to be in person: § 7A allows in-person, live video or phone. § 7A's written-consent and certification rules are written for lower-income, lower-asset borrowers; § 7 requires state-approved counseling before any reverse mortgage. The state minimum age of 60 comes from § 7; the federal HECM minimum age is 62. The MassHealth transfer rule for reverse mortgage money is 130 CMR 520.019(J).
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This page explains the rules; it is not legal advice. For your own situation, talk to an elder law attorney or SHINE.
- HUD — 2026 FHA and HECM loan limits (News release 25-145)
- HUD — Reverse Mortgage for Seniors (HECM)
- M.G.L. c. 167E § 7 — Reverse mortgage loans (7-day rule)
- M.G.L. c. 167E § 7A — Reverse mortgage counseling
- 12 U.S.C. § 1715z-20 — HECM age and counseling
- Mass.gov — Massachusetts law about reverse mortgages