Reverse Mortgages for California Homeowners

A reverse mortgage lets homeowners age 62 and older turn part of their home equity into cash. (Some private reverse loans start at age 55 in some states. See the jumbo page.) You keep the title to your home. You do not have a required monthly mortgage payment. Instead, the loan balance grows over time, and the loan is paid back later, usually when the home is sold.

A reverse mortgage is not free money. Interest and fees are added to your balance each month, so you owe more over time and your equity goes down. That is why California and the federal government add steps to protect you.

Who it may fit

• You are 62 or older and own your home.
• The home is where you live most of the year.
• You have equity in the home.
• You can keep paying property taxes and homeowner's insurance, and keep the home in good shape.

The types we can help with

• FHA HECM. The most common reverse mortgage. It is insured by the Federal Housing Administration. See FHA HECM Reverse Mortgage.
• HECM for Purchase. Use a HECM to buy your next home. See HECM for Purchase.
• Second HECM or HECM refinance. Replace an existing HECM with a new one. See Second HECM and HECM Refinance.
• Jumbo reverse mortgage. For homes worth more than the FHA limit. This is a private loan, not a HECM. See Jumbo Reverse Mortgage.

Who makes the loan

Oakstone Capital Mortgage is a mortgage broker. We are not an FHA-approved lender, and we do not make or fund reverse mortgage loans. We help you apply and compare options. The lender you choose makes and funds your loan and decides if you qualify.

What you still have to do

You must pay your property taxes and homeowner's insurance, keep the home in good repair, and live in the home as your main home. If you do not, the lender can require you to repay the loan.

When the loan is paid back

The loan is usually due when the last borrower sells the home, moves out for good, or passes away. Your heirs can sell the home or keep it by paying off the loan.

What the costs look like

A reverse mortgage has closing costs, a lender fee, and, for a HECM, FHA mortgage insurance. Most of these costs are added to the loan, so they reduce the money you get and the equity you keep. We compare wholesale lenders for you and show you every fee up front. You also get a written cost table that shows the total yearly cost of the loan if you stay 2 years or for the rest of your life.

The steps in California

• Talk with us. We explain the options and answer questions. We do not take an application yet.
• Meet with an independent counselor. A HUD-approved counselor, who is not paid by us, goes over whether a reverse mortgage is right for you. You get a list of approved agencies from us.
• Wait 7 days. In California we cannot take a final application or charge fees until 7 days after your counseling.
• Apply and review the numbers. You see the costs and the cost table in writing.
• Close and keep your 3-day right to cancel. After closing, most reverse mortgages give you 3 business days to cancel.

Watch for scams

Be careful if someone pressures you, offers a "free" home, or says a contractor needs you to take out a reverse mortgage. Real information from HUD is free. You can find a HUD-approved counselor at 1-800-569-4287.

Next step

Questions? Call us at 949-800-8519 or use our contact page. We will explain your options in plain words, with no pressure.

Frequently asked questions

• How is a reverse mortgage different from a regular mortgage? With a regular mortgage you make monthly payments and the balance goes down. With a reverse mortgage you have no required monthly mortgage payment, and the balance goes up over time. You still pay property taxes and insurance and keep up the home.
• Can I lose my home? Yes, if you do not meet the loan rules. The main rules are to pay property taxes and homeowner's insurance, keep the home in good repair, and live in it as your main home. Ask us for the full list.
• What happens to my family? When the last borrower passes away or moves out for good, the loan comes due. Heirs can sell the home or keep it by repaying the loan. For a HECM, they can keep it by paying the loan balance or 95% of the appraised value, whichever is less.
• Do I have to meet with a counselor? Yes, for a HECM. In California, the law also requires counseling and a 7-day wait before a final application or fees. Ask us about private reverse loans, which follow California rules too.
• How much can I get? It depends on your age, the home's value, the interest rate, and the type of loan. We will not guess here. We will show you real numbers in writing after we talk.

License and disclosures

Loans made or arranged pursuant to a California Financing Law license.

Oakstone Capital Mortgage, Irvine, California.

Oakstone Capital Mortgage NMLS #2585868

California Financing Law license number: #60DBO-194582

Steven Arroyo NMLS #1576672

Check any license at nmlsconsumeraccess.org.

Oakstone Capital Mortgage is a mortgage broker and is not an FHA-approved lender.

This website is not from or approved by HUD, FHA, or any government agency. Oakstone is not affiliated with the U.S. government.

Reverse mortgage borrowers must pay property taxes and homeowner's insurance, keep the home in good repair, and live in the home as their main home. Interest and fees are added to the loan balance. You are not required to complete a reverse mortgage just because you have received disclosures.

Equal Housing Opportunity