Reverse Mortgage Signings: What Seniors Need to Know

A reverse mortgage — most commonly a Home Equity Conversion Mortgage, or HECM — lets homeowners 62 and older convert part of their home equity into cash without monthly mortgage payments. The trade-off is a strict, document-heavy signing.

What is in the package

In addition to the standard Note, Mortgage, and Closing Disclosure, you will see a Second Note and Second Mortgage (in favor of HUD), the HUD-1/Closing Disclosure, Loan Agreement, Notice of Right to Cancel, certificate of HECM counseling, and several occupancy and identity affidavits.

Counseling requirement

Federal law requires HECM borrowers to complete HUD-approved counseling before applying. You will sign confirmation that you completed counseling during the signing.

Taking our time

I never rush a reverse mortgage signing. We go page by page, in plain language, and pause whenever you want to call the loan officer. The three-day right to cancel applies here too — nothing funds until the rescission period ends.

Family involvement

It is completely appropriate to have an adult child, attorney, or trusted advisor present during the signing. They cannot answer questions on your behalf, but they can be there for support.