Reverse equity products

HECM Reverse Mortgage in Augusta, GA

A Home Equity Conversion Mortgage, or HECM, is a federally insured reverse mortgage that lets eligible homeowners age 62 and older borrow against part of their home equity while continuing to live in the home. It is a loan. The balance grows over time and must be repaid.

Local guidance from Samantha

Mortgage Capital Services helps homeowners in Augusta, the CSRA, Savannah, and Beaufort compare a HECM with other options and understand the obligations that continue after closing.

What HECM stands for

HECM stands for Home Equity Conversion Mortgage. It is the only reverse mortgage insured by the Federal Housing Administration, and it operates under rules set by the U.S. Department of Housing and Urban Development. People use "HECM" and "reverse mortgage" interchangeably, but they are not quite the same thing: HECM is the FHA-insured program, while "reverse mortgage" also covers proprietary products that are not government-insured.

The word "conversion" describes what the loan does. It converts part of the equity you have built in your home into cash you can use, without requiring you to sell the home or make a monthly principal-and-interest payment.

How a HECM actually works

With a traditional mortgage you make payments and your loan balance falls. A HECM runs the other direction. You receive money, interest and fees are added to the balance, and the balance rises over time. Because there is no required monthly principal-and-interest payment, nothing reduces that balance unless you choose to make voluntary payments.

You keep the title. The lender does not own your home and FHA does not own your home. The HECM is a lien against the property, the same as any other mortgage. You can sell at any time, and you can pay the loan off at any time.

The loan becomes due and payable when the last borrower sells the home, permanently moves out, dies, or stops meeting the loan's requirements. At that point the home is normally sold and the balance repaid from the proceeds. Any equity left over belongs to you or to your estate.

Who is eligible

The youngest borrower must be at least 62 years old. Certain proprietary reverse mortgage programs start at 55 in eligible states.
The home must be your principal residence, and you must continue to live in it.
You need sufficient equity. Any existing mortgage is paid off at closing from the HECM proceeds.
The property must meet FHA eligibility and appraisal requirements.
You must complete counseling with a HUD-approved counselor before the loan can proceed.
You must pass FHA's financial assessment, which reviews your ability and willingness to keep paying property charges.

How much you may be able to borrow

Available proceeds depend on the age of the youngest borrower, current interest rates, the appraised value of the home, and FHA's lending limit. Older borrowers generally qualify for a larger percentage of the home's value, because the expected loan term is shorter.

Each calendar year HUD sets a Maximum Claim Amount, which caps the property value used in the FHA calculation. For 2026 that limit is $1,249,125. A home worth more than that is still eligible, but the calculation treats the value as the limit. It does not mean any borrower can receive that amount. Actual proceeds are always lower, and are calculated individually.

If your home's value exceeds the FHA limit by a wide margin, a proprietary reverse mortgage may make more sense. Ask us what is currently available for your property.

How you can receive the money

Depending on program rules and eligibility, proceeds may be structured as a line of credit, monthly advances for a set term or for as long as you live in the home, a single draw at closing, or a combination.

With an adjustable-rate HECM, the unused portion of a line of credit grows over time under the program's credit-line growth provisions. That growth is additional borrowing capacity. It is not interest you earn, not investment income, and not appreciation in the home's value.

What you remain responsible for

There is no required monthly principal-and-interest payment. That is not the same as having no obligations. You must continue to:

Pay property taxes
Keep homeowners insurance in force
Pay any HOA or condominium fees that apply
Keep the home in good repair
Live in the home as your principal residence

Failing to meet these obligations can cause the loan to become due and payable, and can put the home at risk of foreclosure. This is the most commonly misunderstood part of the program, and it is worth being plain about it.

What it costs

A HECM has real costs. Interest accrues on the amount you have drawn. FHA charges an upfront mortgage insurance premium at closing and an annual premium on the outstanding balance. There are also origination fees, an appraisal, title work, and other standard closing costs. Most of these can be financed into the loan rather than paid in cash, which is convenient but means they accrue interest too.

Because interest and insurance are added to the balance rather than paid monthly, the amount owed grows over time, and the equity remaining for your heirs shrinks accordingly. Anyone weighing a HECM should look at the projected balance over the years they expect to stay in the home, not only the amount available at closing.

What a HECM is not

It is not a government grant or free money. It is borrowed money secured by your home, and it must be repaid.
It does not transfer ownership. You stay on title.
It is not a way to avoid property taxes, insurance, or upkeep.
It does not leave your heirs owing more than the home is worth. A HECM is a non-recourse loan, so repayment is limited to the home's value at the time the loan comes due.

Common questions

01Do I still own my home with a HECM?

Yes. You retain title and ownership. The HECM is a mortgage lien against the property. It does not transfer ownership to the lender or to FHA. You may live in the home, sell it, or pay off the loan at any time, subject to the terms of the loan.

02Can a HECM be foreclosed on?

Yes, in certain circumstances. A HECM can become due and payable if the borrower stops paying property taxes or homeowners insurance, lets the property fall into disrepair, or no longer occupies it as a principal residence. Foreclosure is possible when the loan becomes due and is not repaid. Keeping current on property charges is what prevents it.

03What are the HECM qualifications?

The youngest borrower must be at least 62, the home must be the principal residence, there must be sufficient equity, the property must meet FHA requirements, HUD-approved counseling must be completed, and the borrower must pass FHA's financial assessment of their ability and willingness to pay ongoing property charges.

04Can you refinance a HECM?

Yes. A HECM-to-HECM refinance is possible, and homeowners sometimes consider one when the home's value has risen substantially, when interest rates have moved, or when adding an eligible spouse to the loan. It must provide a genuine benefit to the borrower and is subject to FHA seasoning requirements and a fresh calculation. Whether it makes sense depends on the numbers in your case.

05What happens to my heirs?

When the loan comes due, heirs generally choose between repaying the balance and keeping the home, or selling the home and keeping any remaining equity. Because a HECM is non-recourse, if the balance exceeds the home's value, heirs are not responsible for the difference. FHA insurance covers the shortfall.

06Will a HECM affect my Social Security or Medicare?

HECM proceeds are loan proceeds rather than income, so they do not normally affect Social Security or Medicare. Need-based programs such as Medicaid and SSI can be a different matter, particularly if proceeds are held rather than spent. Discuss your situation with a qualified financial or benefits advisor before drawing funds.

07How long does a HECM take?

Typically 30 to 45 days from application to closing, though it varies. Required HUD-approved counseling happens early and is scheduled directly with the counseling agency. The appraisal, title work, and underwriting follow.

08Can I make payments on a HECM if I want to?

Yes. Although no monthly principal-and-interest payment is required, you may make voluntary payments toward the balance at any time. Doing so slows the growth of the balance and preserves more equity. The decision is yours rather than a required obligation.

Serving Augusta, the CSRA, Savannah, and Beaufort

Mortgage Capital Services works with homeowners across the CSRA and the Georgia and South Carolina coast, including Augusta, Evans, Martinez, Savannah, Pooler, Richmond Hill, Beaufort, and the surrounding Lowcountry. Samantha S. Peel handles residential and reverse mortgage lending and can walk through eligibility, estimated proceeds, costs, and alternatives for your specific property.

What happens next

Talk through your goals, your property, and your questions with MCS.
Review eligibility, estimated proceeds, costs, and alternatives with a licensed professional.
Complete the required HUD-approved counseling.
Decide whether to proceed with an application.

A HECM is not right for everyone. It is worth weighing against selling the home, a traditional refinance, a senior line of credit, downsizing, or simply staying put. The appropriate choice depends on your circumstances, how long you expect to remain in the home, and what you want to leave behind.

Helpful next reading

Ask Samantha about HECM Watch reverse mortgage videos

Important: This page is educational and is not financial, legal, or tax advice, or a commitment to lend. A HECM is a loan that must be repaid. Borrowers remain responsible for property taxes, homeowners insurance, HOA fees, and maintaining the property; failure to meet loan terms can put the home at risk. Mortgage Capital Services, LLC is a private lender and is not acting on behalf of, or at the direction of, HUD, FHA, or any government agency. Mortgage Capital Services LLC, NMLS #2694379 · Samantha S. Peel, Mortgage Loan Officer, NMLS #2685482. Licensed in Georgia and South Carolina. Equal Housing Lender.