The Reverse Mortgage Application Process

Applying for a mortgage can feel overwhelming and complicated – there’s often a rollercoaster ride of financial jargon, paperwork, and plenty of patience. But fear not because at Longbridge Financial, we believe learning about, applying for, and obtaining a reverse mortgage should be as simple as possible.

One of our wonderful mortgage consultants would be happy to walk you through the entire reverse mortgage process in greater detail with you and answer any questions that may come up along the way. Now, let’s take a closer look at what’s involved in applying for a reverse mortgage, and the process from start to finish.

Step 1: Determine if you may qualify.

There are certain eligibility requirements reverse mortgage applicants must meet, but there are a few main qualifiers to start with:

  • You must be at least 62 years old, or 55 years old1 for proprietary loans like Longbridge Platinum.2
  • You must also have significant equity in your home and live in it as your primary residence.
  • Your home must meet minimum property standards set by the U.S. Department of Housing and Urban Development (HUD)—however, you may be able to use your reverse mortgage proceeds to pay for certain required repairs to meet them.
  • You can’t have any outstanding federal tax liens and must have made your property tax payments for the last two years.

Step 2: Find the right lender.

Once you’ve determined you may be a good fit, the next step in applying for a reverse mortgage is to find a reputable lender. You should be looking for one that is a member of the National Reverse Mortgage Lenders Association (NRMLA), is Better Business Bureau (BBB) accredited, and has a good reputation in the industry.

Step 3: Start your application.

Now that you have selected your lender, they will provide you with an application form that you’ll need to complete and return. The application will ask for personal information, such as your name, address, date of birth, and Social Security number. You’ll also need to provide information about your home, including its value, location, and condition.

Step 4: Attend independent counseling.

Once you’ve submitted your application, you’ll need to schedule a counseling session with a HUD-approved counselor. For added confidence and assurance, to ensure that you’ve had all of your questions answered by an independent third-party, all reverse mortgage borrowers are required to speak with government-approved counselors. You’ll receive a certificate after your session that will allow you to complete your application. This mandatory counseling session is designed to help you understand the pros and cons of a reverse mortgage, as well as the alternatives. The counselor will also review your financial situation and help you determine if a reverse mortgage is right for you.

Step 5: Get an appraisal.

After you’ve completed counseling, the next step is an appraisal of your home. This is an important part of determining how much money you can borrow. The appraisal will determine the current market value of your property and will be used to calculate how much you can borrow. The appraiser will visit your home and assess its condition, size, and amenities.

Step 6: Allow time for underwriting.

Once the appraisal is complete, your lender will begin the underwriting process. During underwriting, the lender will review your financial information, including your credit history, income, and expenses. The lender will also verify that your homeowners insurance and property taxes are up to date. If everything checks out, the lender will approve your application and move forward with the loan.

Step 7: Receive your funds.

The final step in the reverse mortgage process is closing. Closing is where you’ll sign the loan documents and receive your funds. You’ll need to pay closing costs, which can include appraisal fees, title search fees, and other expenses. Once your loan is processed and complete, and you’ve chosen when and how you would like to receive your reverse mortgage proceeds, we’ll deliver the final paperwork in person to get your signature. If you had an existing mortgage, it will be paid off. Depending on the type of reverse mortgage you select, you can choose to receive your cash as a lump sum or monthly payment, a draw on the loan as a line of credit, or a combination of these options.3

Now, we’ve covered the reverse mortgage application process from start to finish! Applying for a reverse mortgage can be a complex process, but it can be a useful tool for those looking for greater financial flexibility in retirement. It’s essential to work with a reputable lender and undergo counseling to understand the pros and cons of a reverse mortgage. If you decide you’d like to proceed, see what sets Longbridge apart from the rest!  

Our Commitments to You

With Longbridge as your lender, you’ll have our commitment to go above and beyond to ensure your total satisfaction. Here’s how we make customer satisfaction our highest priority:

  • We’ll listen. Our team will get to know you and take the time to understand your unique situation so we can offer solutions tailored to your needs and help you determine what reverse mortgage solution is right for you.
  • We’ll respond. Your Longbridge reverse mortgage consultant will be there to answer your questions and guide you every step of the way. We are committed to providing our applicants with timely responses – and we don’t run call centers outside of the U.S.
  • We’ll handle it. Our team will order your appraisal on your behalf from a professional, independent appraiser. And, just like every other step, we’ll walk you through the process to ensure you’re comfortable with it.
  • We’ll make it right. If at any point in the process, if an issue arises or things don’t go according to plan, we’ll respond quickly to offer solutions.
  • We’ll work fast. Our goal is to close your loan within 45 days of receiving your application and counseling certificate—and we’ll make every effort to close even sooner.
  • We’ll update you regularly. We’ll be in touch at least once a week with a status update on your loan.

Taking out a reverse mortgage is a big decision and it’s important to do your own research. We encourage you to speak with people you trust, such as your financial advisor and family members, to get their advice and support before applying. By following the steps outlined above, you can make an informed decision about your financial future and ensure a smooth application process. If you or your loved ones have any questions regarding the application process or any other aspect of reverse mortgage loans, contact our team today!

1Available to borrowers as young as 55 in select states only. Higher minimum age requirements may apply.
2Longbridge Platinum Reverse Mortgage (“Platinum”) is Longbridge Financial LLC’s proprietary loan program and is not affiliated with the Home Equity Conversion Mortgage (HECM) loan program, which is insured by FHA. Platinum is available to qualified borrowers who also may be eligible for FHA’s HECM program or are seeking loan proceeds that are higher than FHA’s HECM program limit. Platinum currently is available only for eligible properties in select states. Please contact your loan originator to see if it is currently available in your state.
3Borrowers who elect a fixed rate loan will receive a single disbursement lump sum payment. Other payment options are available only for adjustable-rate mortgages.

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Co-op properties, rental homes, and rental apartments do not typically qualify. Contact a Longbridge specialist for more information.

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