What is AARP’s Role in Reverse Mortgages?

November 29, 2022

The American Association of Retired Persons (AARP) is a large, independent, nonprofit organization dedicated to helping people ages 50-plus achieve financial independence.

While the organization, which serves 37 million older Americans and counting, doesn’t offer reverse mortgage products directly, it does weigh in on them in some significant ways.

Here’s where AARP comes into play for retirees who may be looking into getting a reverse mortgage as a means to age in place.

Table of Contents

• What does AARP think of reverse mortgages?

• AARP influences reverse mortgage policy

• AARP’s Role in Reverse Mortgages

• AARP works to protect reverse mortgage borrowers

• Top FAQs

What does AARP think of reverse mortgages?

AARP has supported reverse mortgage products to help older Americans withdraw their home equity in retirement. While the organization does not offer reverse mortgages, it offers helpful information on this type of loan if you seek more information from an independent third party.

On its website, AARP has a section devoted to reverse mortgages, which can be found here.

If you are wondering what the term “non-recourse” means or are preparing for your reverse mortgage counseling session, AARP offers a glossary of reverse mortgage terms and a wealth of information and questions to ask yourself if you are considering a reverse mortgage.

AARP influences reverse mortgage policy

In addition to its third-party role in providing information about reverse mortgages, AARP also takes a policy role through its Public Policy Institute. Representatives from AARP often appear to work with policymakers on reverse mortgage protections and availability during congressional hearings.

Through its public policy arm, AARP has also published reverse mortgage reports and studies to guide decisions regarding the federally-insured Home Equity Conversion Mortgage program.

This loan program, which insures reverse mortgages under the Federal Housing Administration, comprises most reverse mortgages today and is sensitive to housing policy changes made in Washington, D.C.

Click here for a recent AARP Public Policy report on reverse mortgages.

AARP’s Role in Reverse Mortgages

Aspect	AARP’s Role
Education	Provides resources, glossaries, and questions to help seniors understand reverse mortgages.
Policy Influence	Works with policymakers via the Public Policy Institute to shape HECM protections.
Borrower Advocacy	Defends seniors’ rights, e.g., non-borrowing spouse protections and non-recourse clarity.
Loan Offering	Does not offer or endorse reverse mortgages—focuses on education and advocacy only.

AARP works to protect reverse mortgage borrowers

As the most significant senior advocacy group, AARP ensures that the financial products available to seniors are safe and in the best interest of those who use them.

Those products include reverse mortgages. In the few cases where reverse mortgage borrowers have not been satisfied with their borrowing experience, AARP has come to the defense of those borrowers.

This has recently taken place as a defense for non-borrowing spouses involved in reverse mortgage transactions.

Those non-borrowing spouses who are not on the home title at the time of the loan closing are not entitled to inherit the home once the borrowing spouse has passed away or moved from the home under the policy set by the FHA.

Another recent example involved AARP’s urging the Federal Housing Administration to clarify the reverse mortgage “non-recourse” policy. At AARP’s urging, FHA clarified that any non-borrowing spouse can purchase the home for fair market value if a borrowing spouse passes away or leaves the home.

This vital protection means that a reverse mortgage heir never has to repay more on the loan than the home is worth at the time of the home sale.

Top FAQs

Does AARP offer reverse mortgages directly?

AARP is an advocacy group; they do not make loans. AARP can help borrowers with education, but you must seek a reverse mortgage lender to get a loan.

Does AARP recommend reverse mortgages?

AARP does not recommend for or against reverse mortgages. They do, however, recommend that borrowers take the time to become educated so that borrowers are doing what is suitable for their circumstances.

Does AARP endorse reverse mortgage lenders?

AARP does not endorse specific mortgage lenders.

What is AARP’s involvement with reverse mortgages?

AARP works to educate borrowers on the reverse mortgage programs and as an advocacy group when they feel senior’s rights are being violated.

What Lawsuit did AARP have with HUD?

AARP was instrumental in protecting non-borrowing spouses’ rights on reverse mortgages. They got HUD to change their guidelines so that underaged spouses no longer must come off the title and can live in a home with a reverse mortgage for life, even after the older, reverse mortgage borrowing spouse passes.

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Have a Question About Reverse Mortgages?

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Post your question in the comments below and anticipate a personalized response from Mr. Branson himself, typically within one business day. He's here to illuminate all angles of reverse mortgages, ensuring you're equipped with the knowledge to make informed decisions. Take this opportunity to gain insights from a seasoned professional.

21 Comments on this Article

Patrice T.
November 25th, 2024

I am an eligible non-borrowing spouse from a 2011 reverse mortgage. When my husband passes, I know I can stay in the home due to modified HUD regulations. However, if I sell the home for more than the mortgage balance, can I keep the proceeds/overage? I know I can't access funds left in a line of credit, but what about an outright sale?
Reply to Patrice
- Michael Branson
  December 13th, 2024
  
  The lender and HUD have no control over this situation - it's entirely up to you and your husband, as the property owners, and how the property is titled. The home belongs to you, not the lender.
  If you and your husband have ensured that you are on title to the property, you will have the full right to sell it. As the owner, any proceeds above the amount needed to pay off the loan are yours to keep.
  While it's true that you don't have access to loan proceeds since you're not on the reverse mortgage, the equity in the home belongs to you as the property owner. If you sell the home, you will receive the remaining equity after the reverse mortgage is paid off.
  Reply to Michael
Bernadette A.
July 24th, 2024

Hello Michael, lots of good info here thanks.

About to go into HECM with domestic partner, he is 75, i am 80. Deed has both names. He has the income so LESA sounds good for tax and insurance. in event he goes 1st. Presume no interest is paid on funds set aside until used? In event i go 1st are there more fees to get LESA funds released for his use? Many thanks.
Reply to Bernadette
Becky B.
November 18th, 2023

I am the sole owner of my house. I have around $400,000 in equity. I am on Social Security, which covers my mortgage payment but doesn't leave me enough to pay monthly bills. I am taking money out of my monthly savings to cover my bills. I am thinking of a Reverse Mortgage so that I don't have the mortgage payment and can keep my savings intact. I don't plan on using the equity... that could change. But I don't want to touch it if I don't need to. So, am I a good candidate for a Reverse Mortgage?
Reply to Becky
- Michael Branson
  November 22nd, 2023
  
  Hello Becky,
  
  You absolutely could be. We get a lot of people in your position who have used a reverse mortgage and don't have enough income to get through to the end of the month, and it has worked well for many of them. If your current mortgage was paid off and you didn't have that monthly payment, would that be all you needed to live comfortably in your home? If that would not quite do it, how much more would you need? Then, you can go to the calculator on our website at https://reverse.mortgage/arlo and see what you might expect to receive from a reverse mortgage, given your circumstances, to see if the loan would work for you, given your needs/goals.
  
  It might be a great option if you could live in your home comfortably and not touch your savings. If you are still struggling after getting the loan, you might want to consider other options. You might need to consider downsizing or something else, allowing you to live in another home without struggling. It's a hard decision, but if you get the loan and are still not making it every month, I will not advise you to drain your equity and bank account to stay in that home. Suppose you could use a reverse mortgage to buy another home that might have fewer expenses, cost less, be more energy efficient, or be in another location closer to needed services or family/friends. In that case, it might be time to think about it.
  
  Again, those are options to consider based on your circumstances. If your home meets all your needs and the reverse mortgage means you have all the income you need, you probably don't even want to consider a move. But if you are like many who find that their house is too big, has too much upkeep, or is no longer in the most desirable location for their needs and the costs are growing, it's nice to know that the purchase reverse mortgage program gives you a choice. Start by visiting the online calculator above and see what you might expect. There is no obligation; you do not need to supply your social security number or other personal information. Then you can choose if you want to get more information or not. It's entirely up to you.
  Reply to Michael
  - Mary O.
    September 22nd, 2024
    
    I am 89 years old, with no remaining balance on my $400,000 home, and my savings are quickly depleting because I am about $1,000 short each month. If I get a reverse mortgage, could I receive a lump sum, and how much would that be?
    Reply to Mary
    - Michael Branson
      September 29th, 2024
      
      Hello Mary,
      HUD allows you to access up to 60% of the total funds available to you as a lump sum at closing unless you're using the money to buy a new home or pay off existing loans on the property, which is not the case for you. To give you a general example: if you were eligible for a $250,000 reverse mortgage, you would be limited to receiving 60% of that amount, or $150,000, within the first 12 months, including any loan fees. The remaining $100,000 would be available after the first year, and you could access those funds from your line of credit on day 365.
      This is based on the assumption that you are using the line of credit program, which has an adjustable interest rate. If you choose the fixed-rate reverse mortgage, it is a single-draw loan. With that option, you would receive the initial lump sum but would not be eligible for any additional funds later, forfeiting any remaining balance that was not available at closing. If the fixed-rate option meets your needs and the available funds are sufficient, it's a viable choice, but keep in mind that rates are currently decreasing, and you wouldn't benefit from those reductions with a fixed rate.
      The actual amount you'd receive depends on several factors, including current interest rates, your age, your home's value, and the costs in your area. Interest rates change weekly and are currently declining. The best approach is to visit our calculator, where you can get an accurate, up-to-date proposal specific to your zip code without needing to provide personal information like your Social Security number. This allows you to review the numbers and decide if you want to move forward. You'll also see the different options available, each with varying amounts depending on the margin you select, and it's important for you to understand how each choice might affect you.
      Reply to Michael
Susan
January 15th, 2022

I am 76, spouse (65) going to Assisted Living soon. Home 100% paid off. Am considering Reverse Mortgage but am a bit concerned about keeping up property taxes, etc. Is a Reverse Mortgage appropriate to even consider?
Reply to Susan
- Michael Branson
  January 20th, 2022
  
  Hello Susan,
  
  This is a good thing to consider as failure to pay taxes and insurance is considered a default on the loan. If you do not believe you can pay all your expenses including your taxes and insurance even after the loan, a reverse mortgage is not a good idea. One thing you can consider is a LESA which is a Life Expectancy Set Aside to pay your taxes and insurance from the loan.
  Borrowers can voluntarily set funds aside from the loan to pay the taxes and insurance and the lender will pay those expenses as they come due for the life of the loan. The money is not considered borrowed until the lender actually uses it to pay that installment so you would not accrue interest on that money until the payment was made to the insurance company or the tax assessor and then only on the amount sent to them (not on the entire set aside).
  If you pay the loan off or pass before you use those funds, they were never used so you or your estate (heirs) do not have to repay them when the loan is repaid. And of course, if you or your heirs never repay the loan and let the lender take the property instead, you don't have to worry about it anyway.
  
  You should ask for a comparison with a voluntary LESA included so you can see how much money is left for you to access to see if it works for your needs. Once you opt for a LESA, you cannot change your mind later so you need to be sure this is what you want to do before you close your loan but if the numbers work, it would ensure that the taxes and insurance are always paid for you.
  Reply to Michael
Tammy
September 27th, 2020

I need a person to come talk to me in person in mobile AL about my reverse mortgage through AARP but cannot seem to get that to happen can you help me?
Reply to Tammy
- Michael Branson
  September 27th, 2020
  
  Hello Tammy,
  
  We are not licensed in Alabama and therefore have no licensed loan officers available in your area.
  I would suggest you that you do an internet search for "reverse mortgage originators near me" if you are looking to refinance the loan.
  If you are looking to discuss an existing loan, you should call the number on your monthly statement and they should be able to direct you to someone who can help you.
  Reply to Michael
Tammy
September 10th, 2020

Hi ARLO,

I live in Alabama and have been residing with a man who died a couple of weeks ago. He had a reverse mortgage through AARP, and I was not a borrower on the loan. Where does that leave me and what are my options? I have no job due to him being bed ridden the last year and nowhere to go really. Need your help please. Thank you for any input you can give me!
Reply to Tammy
- Michael Branson
  September 10th, 2020
  
  Hello Tammy,
  
  I believe you should contact an attorney as I cannot advise you on your legal rights.
  I can tell you that the loan becomes due and payable at this time.
  I do not know if there is any equity left in the home or even if you would have any rights to the home at this point. If he left no will and there are other heirs, that may make a difference as to what your next steps should or can be.
  I would strongly suggest that you contact an attorney. You can check to see if there are free legal aid services in your area if you cannot afford an attorney to determine your legal rights concerning the property.
  
  With regard to the loan, the lender will be looking to the heir(s) of the borrower to repay the loan at this time if they wish to keep the home, to make arrangements to sell the property if there is still equity and they do not want to keep it for themselves or to foreclose on the loan and take possession of the home if none of the heirs wish to take any steps to repay the loan.
  If you are aware of any heirs (children, brothers, sisters, etc.) that would have claim to the property, you may think about contacting them to determine what their plans for the property are.
  The lender cannot force you to repay the loan, but they can initiate foreclosure proceedings if no one does step up to repay the obligation. You need to realize that if family takes ownership of the property, they too may have different ideas about what the disposition of the property will ultimately be.
  An attorney in your area can tell you what legal rights you do or do not have as the occupant of the home at this time in any case so that would probably be a good place to start.
  Reply to Michael
  - Tammy
    October 3rd, 2020
    
    The house has been left to me in the will and the reverse mortgage originated in 2018 and he only received 8000 dollars in cash but of course now there is all kind of other charges but I have lived in the home for the last 7 or 8 years as common law wife my my name was not on the loan papers which should have been I dont no if he was explained and understood I could have been even though we was common law or what I was not there the day he did paperwork on the loan o was working but I dont think it's fair now that he has passed that I am gonna lose my home and now I have no job due to the fact he has been bedridden with parkinson for the last year and I have been his only caretaker 24 - 7 . When I did not no about the fact i should of been disclosed on the loan and he assumed i was protected
    Reply to Tammy
    - Michael Branson
      October 5th, 2020
      
      Hello Tammy,
      
      I cannot comment on what was explained to a borrower or not because I was not there, and I do not know what the lender said or his motives or goals.
      He could not have gotten the loan without you unless you were not on title to the property and he claimed unmarried status. This means that not only the lender was of the impression that he was a single individual but the title company as well.
      It sounds like he went to some effort to hide the loan from you if you truly had no idea of the loan because it was not just one day of paperwork that was involved, there would have been more than a month of loan processing including an appraiser who came to the home and did a complete home inspection with the appraisal and your significant other would also have needed to meet and sign all the loan documents at the end with the notary at which time he would also have affirmed his status.
      
      What I can tell you is that if the loan was only originated 2 (+/-) years ago, there has not been too much time to accrue interest and if he only received $8,000 in cash, the remainder of the funds probably went toward paying off an existing loan. If he had not gotten the reverse mortgage, there would have been another mortgage to pay during this time.
      At any rate, there should be equity left in the property since it has been less than 3 years and if you are his heir, you should move to protect your claim on the home (the will does not automatically change the title to you).
      It does not sound like you will be able to remain in the property as you state you have no income to refinance the loan into a new loan at this time and the reverse mortgage is due and payable.
      But in all honestly, based on what you have said, it sounds like without the reverse mortgage you would have been in the same situation when he was stricken with Parkinson's and there was a mortgage to pay then. You may have even been facing a foreclosure at that time if he never got the loan.
      
      I honestly don't know why he didn't add you to title and the reverse mortgage though and make sure you were covered under the reverse mortgage in 2018 if you were living in the home at that time.
      It seems like a logical step to me and I certainly would have informed the borrower of the need or the availability if I knew about the existence of a second person living in the home (significant other or even an eligible family member) but for whatever reason, he didn't.
      My advice to you is to protect yourself now before anything else.
      Take care of the property title so that you can sell it to protect your equity and then if you feel you should, contact an attorney to see if you have any case against the lender on the origination of the reverse mortgage loan.
      I am not an attorney and cannot give you legal advice. I do not know if you have any recourse based on the fact that you may or may not have had a claim to title at the time the loan was completed and you need an attorney to answer those questions.
      If it was me advising a family member though, I would urge them to protect their equity immediately though and the first step is perfecting your title so that you can finance or sell the home and it sounds like financing is not possible for you at this time.
      You should probably contact an estate attorney to determine if the will needs to go through probate or what steps need to be taken to complete the process of transferring the title to you pursuant to the wishes in the will.
      
      You don't need to wait and do things in "steps, you can contact a senior real estate specialist now as well to determine what you need to do to sell the home right away and start that process.
      Then it is your call whether you wish to seek legal counsel about the legality of the existing loan terms.
      I just urge you not to wait until after the home has gone through foreclosure to find out it was too late, and you should have protected your equity first.
      Reply to Michael
Glenda Fischer
September 6th, 2019

Are reverse mortgages available for home owners of manufactured homes ,- double wide and on permanent foundations?
Reply to Glenda
- Michael Branson
  September 8th, 2019
  
  HUD does allow manufactured homes on permanent foundations as long as the property meets all of their requirements and there are adequate recent comparable sales of other similar manufactured homes to support the value and market for the property type. You can find all of HUD's requirements for manufactured homes here.
  Reply to Michael
Seraphina Galante
July 21st, 2019

Hello - I plan/hope to get a Reverse Mortgage in a few years. Is it better for me to pay down my mortgage now while I'm still working? Because then I'd get more with the Reverse Mortgage? Thanks.
Reply to Seraphina
- Michael Branson
  July 23rd, 2019
  
  Hello Seraphina,
  
  I would strongly suggest that you speak with a trusted financial advisor (paid, family or otherwise) and determine what makes the best sense for you and your circumstances. For some, paying down the mortgage makes a lot of sense. For others, having the most cash available would be a better idea.
  Everyone is different and what's right for you may not be the same as for some others. You should decide if your ability to accumulate additional cash in accounts now would be better or if you have enough savings and you feel better about eliminating the debt and would like to lower your interest cost now.
  
  If your property were to decline in value, having the cash might be a good thing to have in the bank as it may not be available on a reduced value later. Otherwise, in a stable or rising value market, it's whatever works best for you and your circumstances.
  Reply to Michael
Ronald Clemente
June 11th, 2019

I have a $325,000 HELOC on my $725,000 home. Would a reverse mortgage be available to clear the HELOC in full leaving me with no payments until the home is sold?
Reply to Ronald
- Michael Branson
  June 11th, 2019
  
  Hello Ronald,
  
  Very possibly. The amount for which you are eligible also depends on the age of the youngest borrower and HUD qualification requirements as well as the age of your HELOC loan but the only way you would know for sure would be to first check my online calculator and with just a very little information (and never a social security number or other personal information), you can see what the benefit amount would be.
  This will tell you if the loan will cover all your outstanding indebtedness. If you are happy with the numbers, we would be happy to go over the HUD requirements with you regarding the lien seasoning to be sure that there are no issues with the existing loan payoff long before you ever spend a dime on any new loan costs. The calculator is free to use, there is never any pressure and it doesn't hurt to see if the loan will work for you.
  Reply to Michael

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