Who is an eligible non-borrowing spouse on a reverse mortgage?

Great Question!

There are two classes of non-borrowing spouses.  One is an eligible non-borrowing spouse and an ineligible non-borrowing spouse.  To become an eligible non-borrowing spouse, the spouse must be married to the borrower when the borrower applies for and closes the loan.

They must also meet all the reverse mortgage requirements that the borrower must meet, such as that they must live in the home as their primary residence, and if the borrower passes,  They are still living in the home; they must continue to pay the taxes and insurance in a timely manner.  They must reasonably maintain the house.

If they are on the title after that time, they must obtain the title after the borrower passes.  The eligible spouse is not a borrower on the loan, so they cannot access the loan proceeds if funds are still available on the line of credit when the borrower passes.  Still, the loan is not due and payable then; it is deferred as long as the eligible spouse meets these conditions.

reverse mortgage spouse eligibility explained by ARLO

If HUD fixed the non-borrowing spouse issue in 2014, what other changes were necessary?

HUD’s rule changes, announced in 2014 and effective in early 2015, did not go far enough to protect spouses.  For one, it did not cover any spouses of loans closed before that time.  In other words, if you completed a loan before the change, your loan was still due and payable if your borrowing spouse passed.

The changes that took effect in 2015 only covered those loans that closed from that time forward.  All spouses of borrowers who received the loan before 2015 were still not covered, and if their spouse passed, even after the HUD changes, their loan was called due and payable at that time.

This was because, with the new changes, all new loans were based on the younger spouse’s age, even though they were not borrowers on loans.  Because they had an eligible status for deferral, their age was considered when the loan eligibility was determined.

Loans closed before the underaged spouse was removed from the title did not consider the younger spouse’s age in the age calculation.  Therefore, a 77-year-old borrower with a 55-year-old spouse would receive a lot more money before the 2014 changes, but that spouse was also not eligible for deferral of the call provisions when their spouse passed.

Secondly, the rule, written in 2014 and made effective in 2015, did not protect spouses of borrowers forced to leave home due to medical reasons.  If the borrowing spouse were forced to go home for more than 12 consecutive months due to the need for hospice care, the loan would be called due and payable by the lender under the HUD rules due to the move being considered permanent.

This created many problems for spouses who met all other conditions, but their spouse did not pass but needed to be placed into assisted living for medical reasons.  Then, their loan became due and payable under the HUD rules.

HUD’s new treatment of non-borrowing spouses

HUD fixed these issues with their new treatment of non-borrowing spouses as outlined in HUD Mortgagee Letter (ML) 2021-11, further extending protections granted by HUD’s previous guidance on the subject in HUD Mortgagee Letter (ML) 2019-15.  Effective immediately, all non-borrowing spouses, not just the ones whose loans began after the 2014 change date, now have the non-borrowing spouse deferral protection.

This is a considerable comfort and protection for spouses who were not on the loan their spouse received and have feared that they would lose their ability to remain in their homes.  Furthermore, HUD removed the provision that the loan could still be called due and payable if the borrowing spouse had to leave home for more than 12 months due to medical reasons for all non-borrowing spouses who held this designation at the time the loan was closed.

In other words, the non-borrowing spouse is protected from having to leave their home due to the call provision due to their spouse’s death and the medical need to go home now.  This is especially important because HUD determined that they would cover spouses before their age was also considered in loan amount calculations, so they got an advantage in additional funds available.

What spouses are not covered?

For a person to be considered a spouse, the borrower must consider them a spouse and declare them a spouse when the loan is closed.  Remember that this still does not cover spouses not married to the borrower when the loan closed.  New individuals who became spouses after the loan’s closing are still not covered under the existing reverse mortgage.

In other words, borrowers cannot try to add someone claiming to be a common-law spouse when the loan closed, but they stated they were unmarried.  For newly married spouses, the only way to still ensure that the terms of a reverse mortgage cover them, if that is your goal, is to obtain a new loan in both your names or with them being a current “eligible non-borrowing spouse” now at the time you take out the new loan if they are not yet 62 years of age.


Do you know if there are any other changes or things you need to know?

Non-borrowing spouses cannot access the loan after the borrower passes.  This means that if funds are still available on the line of credit, they remain unborrowed and do not need to be repaid when the loan is closed, but the non-borrowing spouse cannot make additional draws against the line.  The non-borrowing spouse may remain in the home for as long as they desire if they meet the eligibility criteria.

The non-borrowing spouse is no longer required to secure title to the property within 90 days of the borrower’s passing if the spouse does not have title to the property.  This is another improvement as probate and other issues often stretch transferring title to the remaining spouse beyond the old 90 requirements by HUD.

Our Recommendations

We recommend that borrowers add the non-borrowing spouse back to the title as soon as the loan closes so that there are no problems later (for those spouses removed from the title before 2015, they are no longer required to be removed as of the 2014 changes).  This was more of an issue for the loans closed before 2015 when non-borrowing spouses needed to come off the title, but there is no reason to keep them off the title after the loan closes.

HUD allows borrowers to add anyone they want to title if they are still on title and still living in the home.  We also recommend that borrowers write letters authorizing lenders to deal with non-borrowing spouses in all matters relating to the loan so that the non-borrowing spouse has full authorization to deal with the lender on the borrower’s behalf.

If you have a non-borrowing spouse, you should file all paperwork with the lender to allow your spouse full access to the lender and the loan information.  In contrast, both spouses are still alive when everyone can sign any required authorization.

To be eligible for deferral of a reverse mortgage, you must be married, living in the home when the loan closes, and still living in the home as your primary residence when the borrowing spouse passes or permanently moves to a medical facility.

Finally, the non-borrowing spouse has the same responsibilities as the borrower concerning the fact that they must pay the taxes and insurance on time and reasonably maintain the home.

An eligible non-borrowing spouse who does this can stay in the home for as long as they live and want to remain.

not eligible sign

Ineligible = No Deferral Granted

Ineligible non-borrowing spouses might be those who don’t occupy the property (separated borrowers who do not live in the home), were not married to the borrower at the time the loan was closed, or because of familial or other issues, cannot get title to the home, (perhaps the home goes to other heirs upon the death of the borrower).

They would not be eligible for the deferral; therefore, the loan would be due and payable upon the borrower’s passing.  I hope this helps.

Eligible vs. Ineligible Spouse Protections

Eligible Non-Borrowing SpouseMarried to the borrower at the time of loan closing and remains married until the borrower's death.Can remain in the home after the borrower's death without the loan becoming due, under certain conditions.
Ineligible Non-Borrowing SpouseNot married to the borrower at the time of loan closing, or the marriage ends before the borrower's death.May have to vacate the property or pay off the loan upon the borrower's death.
This table distinguishes between scenarios where a spouse is eligible or ineligible for protection of a reverse mortgage loan. This information is critical for borrowers considering a reverse mortgage to understand the protections afforded to current or potentially future non-borrowing spouses.

Spouse FAQs


Do both spouses need to be 62 for a reverse mortgage?

In most instances, the answer is no.  Recent HUD rule changes implemented a deferral option for eligible non-borrowing spouses that protects past non-borrowing spouses.  This deferral option allows a non-borrowing spouse to live in the property even if the eligible borrowing spouse predeceases them or leaves home for medical reasons.  Previously, the non-borrowing spouse would have to pay off the reverse mortgage or potentially move out of the home.  Non-HUD-insured reverse mortgages do not allow for deferral periods, and certain states, such as Texas, do not permit a non-borrowing spouse on a reverse mortgage loan.

Can my new spouse be added to my Reverse Mortgage?

No.  Your new spouse could not be added if you obtained a reverse mortgage loan before marriage.  If you add your new spouse to the title, that does not alter the terms of the existing reverse mortgage, but there would also be no deferral for your spouse because they were not accounted for on the original loan.  The only way to protect your new spouse with a reverse mortgage is to refinance to a new loan that would consider both of your ages in the calculations.

What happens if a spouse dies with a reverse mortgage?

What transpires upon the death of one spouse will depend upon several factors, including how the loan was set up initially, who was a borrower, and under what guidelines were in effect at that time.  If both spouses were borrowers on the loan, and one spouse is still living in the property after the passing of the other spouse, nothing happens with the loan as a result.  The reverse mortgage would not become due and payable until the passing of the last surviving spouse.  If the spouse who passed away was the only eligible borrower and the surviving spouse was an ineligible non-borrowing spouse, or if the loan was taken out before HUD implemented the deferral option, the loan would become due and payable.  If the surviving spouse was an eligible non-borrowing spouse, was only ineligible because the loan was closed before 2015, and in all other ways would have been an eligible non-borrowing spouse and remained eligible, they can contact their loan servicing and file for the deferral option, and the loan would remain in good standing allowing the surviving spouse to stay in the property for the duration of their lifetime.

What is an eligible non-borrowing spouse?

An eligible non-borrowing spouse is an individual who is married to a reverse mortgage applicant when the loan closes (or the borrower declares he is their married partner) who will not be a borrower of that loan but is living in the subject property as their primary residence.  A spouse can be an eligible non-borrowing spouse by choice or due to being under the age of 62.  The eligible non-borrowing spouse’s age is factored into the loan-to-value calculation on the reverse mortgage loan because of the deferral option they qualify for.  An eligible non-borrowing spouse can become ineligible if they move out of the property when the reverse mortgage is in place.  A spouse can start as suitable but become ineligible for deferral over time.  Any non-borrowing spouse (whether eligible or ineligible) cannot access any reverse mortgage proceeds during the borrower’s lifetime or after their passing if they are in the deferral period.  Only borrowers of the reverse mortgage loan can access loan proceeds.

What is an ineligible non-borrowing spouse?

An ineligible non-borrowing spouse is an individual who is married to a reverse mortgage borrower who does not live in the subject property.  Common examples of this are spouses who are separated or who choose to live in separate homes while still being married.

If you have a reverse mortgage and get remarried, how long does your spouse have to stay home when you pass away?

If you get a reverse mortgage loan and then remarry after, your spouse is not eligible for any deferral period afforded to an eligible non-borrowing spouse when the loan was closed.  In this instance, they would have the same time as any other heir to get the loan paid off or the property sold.  The Mortgage Servicer can grant an extension of time in 90-day increments up to a full year for the heir to sell the home, so that would be the maximum time they could remain in the property while attempting to sell the home.

If one of the spouses dies, can the other stay in the home?

If both spouses are on the loan or one spouse is not on the loan but is an “eligible non-borrowing spouse,” then yes, either spouse can remain in the home for life even after the other spouse passes with a reverse mortgage.  The remaining spouse still must pay the taxes and insurance in a timely manner and reasonably maintain the home.  If your spouse is not on the loan, was not married to you at the time the loan was closed, or was ineligible for any other reason (wasn’t living in the house, etc.), then that spouse would not have the right to remain in the property after the passing of the borrower.  If you wish to make an ineligible spouse eligible to remain in the home, you must apply for a new loan under both individuals’ names, with both spouses on the new loan.