Reverse Mortgage vs. Home Equity Loan
A reverse mortgage, generally available to older homeowners, allows borrowing against home equity without required monthly payments, while a traditional home equity loan is available to any qualifying homeowner but requires regular monthly repayment.
By submitting, you agree to be contacted by phone, text, or email about your project, including by automated means, even if your number is on a do-not-call list. Consent is not a condition of purchase. See our Privacy Policy and TCPA Compliance page for details.
Assigners CommitmentYour request is only shared with a service provider matched to your project and service area — never sold as part of a bulk or resold list.
Reverse Mortgage
A loan generally available to homeowners above a certain age, allowing them to convert home equity into cash without required monthly mortgage payments, repaid when the home is sold or the borrower no longer lives there.
- No required monthly mortgage payments while living in the home as your primary residence
- Can provide income or a line of credit for older homeowners on a fixed income
- Meaningfully higher upfront costs than a traditional home equity loan
- Loan balance grows over time as interest accrues without payments
- Reduces the equity or inheritance ultimately left in the home
Home Equity Loan
A traditional lump-sum loan against home equity, available to any qualifying homeowner regardless of age, with required monthly repayment.
- Available to homeowners of any qualifying age
- Lower overall closing costs than a reverse mortgage typically
- Requires regular monthly payments, unlike a reverse mortgage
- Requires sufficient income to qualify for and support the payments
Which one makes sense for you?
A reverse mortgage can provide valuable cash flow for eligible older homeowners without requiring monthly payments, but it comes with higher costs and reduces remaining home equity over time. A traditional home equity loan is available more broadly and costs less upfront, but requires the income to support regular monthly payments.
Key cost factors.
- Whether you meet the minimum age requirement for a reverse mortgage
- Your monthly income and ability to support a traditional loan payment
- How much you prioritize preserving home equity for heirs
- Your plans for staying in versus eventually selling the home
Before you decide.
- Do I meet the age and equity requirements for a reverse mortgage?
- How would each option affect what's ultimately left in the home's equity?
- Can I comfortably support a monthly payment, or is that a limiting factor?
Frequently asked questions.
Does the homeowner lose ownership of the home with a reverse mortgage?
No — the homeowner retains the title and ownership, but the loan balance must be repaid, typically through sale of the home, when the borrower moves out, sells, or passes away.
All figures on this page are illustrative examples for general education, not quotes, appraisals, or guarantees of actual pricing. Actual costs vary by provider, location, project scope, and market conditions — always get a specific quote before making a purchasing decision.
Selling in real estate?
Talk to our sales team about sourcing exclusive, real-time leads, warm transfers, and inbound calls.