You have a homeowning client couple seeking your financial advice. You and the couple think a Home Equity Conversion Mortgage or HECM (the federally-insured reverse mortgage) might be a great option for them. The husband is 65, but his spouse is only 59. You know that the spouse is too young for a reverse mortgage, since HECM borrowers must be 62 years old. Still, they have no way near enough investments to cover their monthly bills in retirement. They do, however, have $800,000 of equity in their $1,000,000 home. They desperately need to get rid of their monthly mortgage payment but don’t ever plan to move..

The question financial professionals frequently ask is this:

Can a senior homeowning couple still get a reverse mortgage if one spouse is too young for a reverse mortgage, and if so, what should they know about it?

The HECM requires only one spouse to be 62 or older. The younger spouse is designated the Non-Borrowing Spouse (NBS). They secure their right to remain in the home and defer the loan’s repayment after the borrower’s death by meeting ongoing obligations.

This right is not arbitrary. It represents one of the most significant consumer protection upgrades in HECM history. It ensures the surviving spouse can remain safely in the home after the borrower passes away. For you, the financial professional, mastering the rules surrounding Non-Borrowing Spouse Protections is essential. Failure to correctly document the NBS can result in the immediate and unnecessary loss of the home for the surviving spouse.

This guide clarifies the rights and responsibilities of the NBS for the FHA-insured HECM reverse mortgage. Please note that non-FHA-insured reverse mortgages (known as “proprietary,” “self-insured,” or “private” reverse mortgages) often have lower age limits. Depending on the state, this lower age limit can be as young as 55. However, this guide addresses HECM loans only. It provides you with the due diligence steps to protect your client’s most valuable asset and secure their future housing.

Getting the Loan When One Spouse is Too Young for a Reverse Mortgage (Under 62)

The HECM is an FHA-insured loan designed to allow homeowners to age in place with financial security. This guide addresses the rules for the specific situation where there exists an age gap in a couple seeking a reverse mortgage.

The Age Requirement and the Borrower’s Role

The minimum age requirement is 62. If one spouse is too young for a reverse mortgage, only the older spouse can be a borrower.

• The Borrower: The spouse who is 62+ will execute the HECM loan documents. They are the only party who can request and receive draws from a HECM’s line of credit. The borrower is legally responsible for the loan.
• The Non-Borrowing Spouse (NBS): If under 62, the spouse is too young for a reverse mortgage. However, the HECM loan must list them as the NBS. This became mandatory with important changes to the HECM rules in the mid-2010s. If not listed on the loan when the borrower dies, the younger spouse must refinance or sell the home within 6-12 months. This would force the surviving spouse to either pay off the loan or sell the home. Unfortunately, this was the case before these changes. Even today, most negative reactions to reverse mortgages trace back to the pre-2014 rules.

Listing the younger spouse as the NBS ensures they have access to the Non-Borrowing Spouse Protections. These protections allow the spouse who is too young for a reverse mortgage to continue living in the home and defer  the loan’s repayment after the borrower’s death. But, can they continue to access the other financial benefits of the reverse mortgage? Great question!

The Financial Drawback of the NBS Designation

While listing the NBS protects their tenure rights, it comes with a financial trade-off your client needs to understand.

First, while the NBS may continue living in the home if widowed, they may not access any remaining equity. If the borrower was receiving a month loan advance, that ceases as well.

Additionally, the FHA calculates the Principal Limit (the maximum amount the client can access) based on the age of the youngest eligible spouse. Even if one spouse is too young for a reverse mortgage (say 59), the FHA uses the age of 59 in its calculation. It doesn’t matter that they aren’t the borrower). This results in a lower borrowing potential than using the older spouse’s age. You can see why, before the 2014 changes, many such couples chose to leave the younger spouse off the paperwork. They chose, albeit shortsightedly, greater financial benefits over long-term protection.

Financial professionals working with widowed NBS appreciate this trade-off. A lower initial loan benefit leads to improved long-term housing security for the widow.

Protections When a Spouse Is Too Young for a Reverse Mortgage

The primary NBS right involves deferring the HECM’s repayment after the death of the borrower. Such deferment means the NBS remains in the home if they meet the following criteria.

The Four Conditions for Payment Deferral

If a spouse is too young for a reverse mortgage, they can still invoke the Non-Borrowing Spouse Protections and defer repayment when widowed. They just need to satisfy all four of HUD’s following conditions:

1. Marriage Documentation

If the non-borrowing spouse is too young for a reverse mortgage, their marital status matters. They must have been legally married to the borrower at the time of the HECM closing. Additionally, they must remain married until the borrower’s death. If such spouses marry after the loan closes or divorce before the death of the borrower, the survivor is not eligible to live in the home.

2. Occupancy Requirement

The NBS must occupy the property as their principal residence at the time of the HECM closing and must continue to reside there as their principal residence. If the surviving NBS moves out for more than 12 consecutive months, the HECM will become due and payable.

3. Establishing Legal Ownership or Right to Remain

This is the single greatest point of failure in cases where one spouse is too young for a reverse mortgage. Within 90 days of the borrower’s death, the NBS must establish legal ownership of the property or obtain a legal right to remain on the property. If the title already lists them as an owner, this meets the requirement. However, concerns arise if they are not listed on the property title.

• Due Diligence Alert: As the professional, you should work to ensure the NBS has a clear path to the title upon the borrower’s death. This often requires preemptive estate planning, such as using a survivorship clause in a will, a Transfer-on-Death Deed (where allowed), or placing the property into a Living Trust with clear succession language. If the title transfer is legally delayed or impossible, the deferral becomes void, and the loan becomes due.

4. Satisfactory Performance of Obligations

The NBS must demonstrate continued “satisfactory performance” of all non-loan obligations.

If all four conditions are met, the loan repayment is deferred until the NBS either dies or moves out permanently.

A Note on the Loan Status During Deferral

When a spouse is too young for a reverse mortgage, they need to understand that while they retain tenure rights after the borrower’s death, the loan remains in deferral status.

• No New Draws: The NBS cannot access any remaining Principal Limit or Line of Credit. The ability to take loan funds ceases the moment the borrower passes away.
• Loan Balance Continues to Grow: Interest and FHA insurance premiums continue to accrue on the outstanding balance. The debt grows larger, eroding the remaining equity, which reduces the potential inheritance for heirs.

How to Maintain Protections When a Spouse Is Too Young for a Reverse Mortgage

The Non-Borrowing Spouse Protections do not come without actions on the NBS’s part. The NBS must actively fulfill the ongoing responsibilities of the HECM.

The Non-Negotiable Payment Obligations

Just like the original borrower, the surviving NBS becomes solely responsible for paying property taxes and homeowners insurance (known as “property charges”) promptly. If the homeowner belongs to a homeowners association, they must also pay those dues.

• Failure Trigger: Failure to pay these property charges constitutes a loan default. If the NBS misses a property tax payment, the loan becomes immediately due and payable. This is the most common reason a surviving spouse will lose their homes. If they miss an insurance payment, the lender will secure “force-placed insurance” to cover the building but not the personal property. The premiums are much higher and ultimately need to be paid by the NBS to remain in the home.
• Maintenance: The NBS must maintain the home according to FHA standards. Neglecting any repair that leads the city or county to condemn the home will alert the FHA to review and eventually trigger the due and payable status. Most commonly, such maintenance involves issues with the roof, flooding, lack of sanitation (no utilities), widespread mold, and pest infestations.

The Annual Certification Requirements

Even if a spouse is too young for a reverse mortgage, once widowed, this NBS must comply with the lender’s annual requirements, primarily the occupancy certification.

• Occupancy Certification: The NBS must provide annual evidence that they continue to reside in the home as their principal residence. Failure to return this simple certification can trigger a review, potentially accelerating the loan repayment.

As a professional serving senior homeowners, you should communicate to your clients that the NBS assumes a significant, long-term responsibility. They must have sufficient, independent income or accessible liquid assets to cover these mandatory housing expenses for the rest of their lives in the home.

Professional Due Diligence: Your Mandate to Secure the NBS

As the professional advising a couple pursuing a HECM when one spouse is too young for a reverse mortgage, you assume the role of guiding them to ensure all legal and financial foundations are solid before closing.

Vesting and Title Alignment: The Primary Risk

This is the most critical actionable step for estate planners and attorneys: the NBS must successfully satisfy the legal ownership requirement within 90 days of the borrower’s death.

• Mandate: Ensure the NBS is named in a legal instrument that guarantees they will acquire the property upon the borrower’s death.
• Reviewing Existing Title: If the property is currently held in joint tenancy with rights of survivorship, the transfer of title is usually seamless. If the property is held as Tenants in Common, or if the borrower holds the property solely, the NBS’s rights must be secured via a will, trust, or other legal document before the HECM closes. Do not rely on probate courts to handle this in time to prevent HECM loan repayment. Your work  can preempt ownership issues with the loan.

Financial Assessment and Tax Counseling

While HECM loan offers perform their own financial assessment of the borrower, you can provide a deeper level of planning.

• Cash Flow Projection: Project the client’s mandatory expenses (taxes, insurance, maintenance) against the NBS’s projected fixed income. The widowed NBS may not have the borrower’s income, and they will not have access to the HECM line of credit. Confirm they will have enough income to cover projected expenses. 
• Inheritance Implications: Advise the NBS that while the initial HECM loan funds are tax-free, the interest that accrues on the deferred loan balance typically decreases the size of the estate their heirs will inherit.

Remarriage and Future Planning

A common question that arises during the planning process involves the NBS’s future.

• Remarriage: If the surviving NBS later remarries, their continued tenure rights under the HECM are not affected, provided they meet all previously mentioned obligations. The HECM’s focus remains on protecting the individual who was the spouse at the time the loan was originated.
• Refinancing: If sufficient equity remains in the home, the NBS should consider refinancing the HECM into a new HECM if they are older than 62. This may provide them with access to a line of credit or monthly loan advances.

Securing the Future with Non-Borrowing Spouse Protections

The decision to proceed with a HECM when one spouse is too young for a reverse mortgage (under 62) requires a high degree of diligence. However, even in such circumstances, a HECM can become a powerful financial planning tool when executed correctly. It allows a couple to access critical liquidity now, while legally guaranteeing the younger spouse will not have to leave their home later.

By understanding the four conditions for deferral and proactively addressing the vesting and financial responsibilities of the NBS, you effectively protect the longevity of the loan and secure your client’s most valuable asset. The HECM is a very structured tool, and your guidance can ensure it works exactly as intended, providing financial independence and peace of mind.

I invite you to view the rules regarding the Non-Borrowing Spouse Protections not as a hurdle, but as a framework for responsible, secure financial planning for your senior clients. Please reach out if I can provide case-specific guidance or support your work in educating clients on these complexities.