How to Use This Glossary

A type of interest rate that can change periodically based on a market index. Most reverse mortgage products in Florida utilize an adjustable rate, which allows for the unique "Growth Feature" found in a line of credit.

The estimated market value of your home, as determined by a licensed appraiser. This value is used to calculate how much you may qualify for with a Florida reverse mortgage.

A Financial Assessment method that converts verified liquid assets into a calculated monthly income stream to help borrowers meet FHA residual income requirements.

The homeowner (or homeowners) listed on the reverse mortgage loan who meet all eligibility requirements, including age (typically 62+ for HECMs) and primary residence occupancy.

Fees associated with finalizing a reverse mortgage, including appraisal fees, title insurance, recording fees, origination fees, and government charges. Many Florida reverse mortgage borrowers choose to finance these costs into the loan.

An FHA process allowing an individual condominium unit to qualify for a reverse mortgage even if the entire project is not FHA-approved.

A mandatory session with an independent, FHA-approved counselor who explains the benefits, risks, and obligations of a reverse mortgage. Required for all FHA HECM reverse mortgages in Florida.

The federal agency that oversees the Federal Housing Administration (FHA). HUD sets the rules and lending limit for all HECM loans.

The ways you can receive your reverse mortgage proceeds include a lump sum, monthly payments, a line of credit, or a combination of options.

The difference between the home’s market value and the remaining balance on any existing mortgage is the amount the homeowner can access through a reverse mortgage.

The most common mortgage product for seniors. It is a government-insured loan that allows you to convert a portion of your home's equity into cash without making monthly payments.

The government body that provides insurance for HECM loans. Because these loans are insured by the Federal Housing Administration, you are protected if your lender goes out of business or if the home's value drops below the loan balance.

The Financial Assessment is FHA’s review of a borrower’s income, assets, credit history, and property charge payment history to determine their ability to meet ongoing obligations such as property taxes, homeowners' insurance, and HOA dues. Required for all FHA HECM reverse mortgages, it helps determine whether a Life Expectancy Set-Aside (LESA) is needed and ensures the borrower can sustain the home long-term.

A feature of HECM lines of credit is that the unused portion increases over time.

A high-intent term for 2026. This refers to the rate at which the unused portion of your line of credit grows over time. The growth rate is equal to the current interest rate plus the mortgage insurance premium. This ensures your future buying power keeps pace with inflation.

An FHA-insured reverse mortgage designed for homeowners aged 62 and older. HECMs are the most common and widely used reverse mortgages in Florida.

A reverse mortgage program that allows eligible Florida seniors to purchase a new primary residence using a reverse mortgage, without required monthly mortgage payments.

A popular reverse mortgage option that allows borrowers to access funds as needed. The unused portion grows over time, providing increased borrowing power and long-term financial flexibility.

A HECM to HECM refinance replaces an existing FHA reverse mortgage with a new one, typically to access additional funds due to increased home value or improved loan terms. The new loan must meet FHA’s “Net Tangible Benefit” requirement to ensure the refinance provides a meaningful financial advantage.

The portion of your home’s value that you own outright. It is calculated by subtracting any existing mortgage balance from the home’s appraised value.

The amount available to a borrower at closing is determined by the borrower’s age, interest rates, the appraised value, and FHA lending limits.

A one-time Florida tax due at closing. In 2026, the rate is 2 mills (or $2 per $1,000) of the principal limit available to the borrower. Because we are local experts, we ensure these Florida-specific costs are accurately calculated in your quote.

The rate applied to the outstanding loan balance. Reverse mortgage interest rates may be fixed or adjustable, depending on the product chosen.

A proprietary (non-FHA) reverse mortgage designed for high-value Florida homes that exceed FHA lending limits. Some jumbo reverse mortgages are available to borrowers as young as 55.

A Florida-specific deed that allows homeowners to retain full control of their property during life while automatically transferring ownership upon death. Often compatible with Florida reverse mortgages.

Essentially a "Reverse Mortgage Escrow." If a lender determines you may struggle with paying property taxes or homeowners' insurance, they will set aside a portion of your loan proceeds to pay these bills on your behalf for the life of the loan.

A form of property ownership where an individual retains the right to live in the home for life, while ownership passes to another party upon death.

A portion of reverse mortgage funds is set aside to pay future property taxes and homeowners' insurance. Required in certain cases based on financial assessment results.

The total amount owed on a reverse mortgage, including disbursed funds, interest, and mortgage insurance premiums. The balance increases over time.

The point at which the reverse mortgage becomes due and payable is typically when the borrower sells the home, permanently moves out, or passes away.

Certain debts that must be paid at closing with reverse mortgage proceeds, such as an existing mortgage, delinquent property taxes, or homeowners' insurance.

For 2026, the FHA has set the nationwide HECM limit at $1,249,125. This is the maximum home value used to calculate your principal limit.

A fee paid to the FHA. There is an upfront MIP (typically 2% of the home value) and an annual MIP (0.5%). This insurance is what makes the loan "non-recourse" and protects your heirs.

A spouse who is not listed as a borrower on the reverse mortgage loan. FHA rules may allow eligible non-borrowing spouses to remain in the home after the borrower’s death.

A guarantee that neither the borrower nor their heirs will ever be personally liable for a loan balance that exceeds the home's value. When you sell the home to repay the loan, the lender can only look to the property for repayment, not your other assets.

Borrowers must occupy the home as their primary residence. Extended absences may trigger loan maturity under reverse mortgage rules.

A lender fee charged for processing and underwriting a reverse mortgage, subject to FHA limits for HECM loans.

The home where you live for the majority of the year (at least 6 months and 1 day). To keep your equity conversion mortgage, HECM, in good standing, you must maintain the home as your primary residence.

The total amount of money a borrower is eligible to receive from a reverse mortgage loan. This amount is determined by a Principal Limit Factor, which considers the youngest borrower's age, current interest rates, and the home's value.

Ongoing homeowner responsibilities, including property taxes, homeowners' insurance, HOA dues, and maintenance. Failure to pay can result in loan default.

Also known as "Jumbo" loans. These are reverse mortgage products not insured by the FHA. They are designed for high-value homes and can offer loan amounts up to $4 million, often with borrowers as young as 55.

An individual who inherits the property after the death of the life estate holder. In Florida, reverse mortgages, remaindermen typically attend counseling but are not borrowers.

The income remaining after paying monthly debts and property charges.

A loan that allows eligible homeowners to convert home equity into cash without required monthly mortgage payments, while retaining ownership of the home.

A Reverse Second Mortgage is a reverse mortgage placed behind an existing first mortgage, allowing homeowners to access additional equity without paying off their primary loan. These are typically proprietary (non-FHA) products and are less common than standard HECM reverse mortgages.

The ongoing administration of a reverse mortgage, including disbursements, account statements, escrow payments, and borrower communication.

Another Florida-specific closing cost. For HECM loans, Florida law dictates that doc stamps are calculated at $0.35 per $100 of the principal limit. Our team handles these filings with the local government to ensure compliance.

Monthly payments are provided for as long as the borrower lives in the home and meets loan obligations.

Two different payment options:

• Tenure:Guaranteed monthly loan proceeds for as long as you live in the home.
• Term:Guaranteed monthly payments for a specific, fixed number of years.

Monthly payments are made for a fixed number of years, regardless of how long the borrower occupies the home.

Insurance that protects against ownership disputes or title defects. Required in Florida reverse mortgage transactions.

Homes held in certain revocable or qualifying irrevocable trusts may still be eligible for a Florida reverse mortgage, subject to FHA or lender guidelines.

Closing-related costs, including appraisal fees, title work, origination fees, and upfront mortgage insurance.

Reverse mortgage funds are tax-free and may be used for any purpose, including paying off debt, covering living expenses, home improvements, or supplementing retirement income.

Periodic confirmation that the borrower continues to occupy the home as their primary residence.