Reverse Mortgage in Texas

Kiplinger Magazine lists several Texas cities like San Antonio and McAllen as among the most affordable places to live in the United States.  Even with Texas being an affordable state, however, senior citizens who reside here often need to research the ways that they can maximize their retirement dollars.  One of the key ways that more Texas seniors are accomplishing this is through reverse mortgages.  Before they apply for this type of financing, people may wonder what regulations and recommendations are in place to protect them.  They can make an informed decision regarding their finances by understanding how reverse mortgages in Texas are governed.

reverse mortgage in texasTexas Resources on Reverse Mortgages

When it comes to regulating these unique loans, Texas complies fully with the federal laws already in place for reverse mortgages.  In fact, Texans who have questions or simply want to know how they can begin the application process can contact the state’s Housing and Urban Development agency to request this information.  Along with HUD, organizations like AARP and the Texas Department of Protective and Regulatory Services can also make sure that people are informed about this type of loan before applying.

They can also find out more about these loans by contacting the state’s Consumer Credit Commissioner in Austin.  They can either call the Commission or visit the agency’s website at  This website contains information about how to apply and reasons why this line of financing could be ideal for their retirements.

Basic Qualifications for Reverse Mortgages

As with other seniors around the country, Texas retirees also must meet some basic criteria before they can begin the application process.  Some of the more basic requirements include:

Owning their own home and using it for a primary residence
Being 62 years of age or older at the time of the application
Have equity in the home being used for the reverse mortgage
Completing a credit counseling course prior to receiving the loan.

If senior citizens can meet these base requirements, they may proceed with their application and possibly be approved for a reverse mortgage.

Home Criteria for Reverse Mortgages

Another vital part of the application process involves owning a house that meets the criteria for the loan.  This program allows reverse mortgages to be applied to single family homes, duplexes, town homes, two to four unit homes, and also manufactured homes that meet FHA loan requirements and were built after 1976.

The home being used on the application cannot be a vacation home, used as second residence, be cooperatively owned, or be a rental property.  These types of residences will be excluded and the application will be denied.

Repayment of Reverse Mortgages

Many Texas senior citizens find this type of financing to be appealing because it comes with simple repayment terms.  In essence, the loan does not have to be paid back while the homeowners are still living in the house.  After they pass away or move to another location, the home will be sold to satisfy the terms of the reverse mortgage.

These terms, however, mean that people cannot will their homes to their next of kin, nor can they sell their houses or take out another line of home equity while the reverse mortgage is in place.  Once the house is sold, any remaining equity can be willed to the next of kin.  The lender cannot claim an amount of the home’s sale that is greater than the amount of the loan.

With these facts made known, Texas retirees can choose whether or not to pursue a reverse mortgage in that state.  They can make an informed decision and learn why this line of financing can help them enjoy their retirements even more.