The new HECM reverse mortgage allows for seniors to get a reverse mortgage loan even if their spouse is under the age of 62. As long as one of the borrowers is over the age of 62 the other homeowner will be considered a non-borrower spouse and the deal may be approved.
These changes took effect on August 4th, 2014. Prior to this seniors would be forced in some instances to take the younger spouse off the reverse mortgage to qualify and to receive a larger proceed. The amount you receive from the reverse loan is mainly based on the homes value and the age of the youngest borrower (with older homeowners receiving more equity).
The issue with the strategy above was that when the HECM borrower passes away the loan will become due and payable. The younger spouse would not have any rights to the home and would not be given any time to find the means to pay off the loan, refinance, etc. Many seniors lost their homes due to not being on the title to qualify and increase how much they borrowed. Many consumer advocates are pleased with the new rules introduce by HUD as it gives more seniors to ability to utilize the program while also creating safeguards for the younger spouse.
The new rules come with new lowered lending principal limits for those younger seniors. While you will qualify for the program even if one is under the age of 62, expect to receive around 50% or less of the homes appraised value. With seniors living longer these days, FHA has reduce the amount that can be borrowed by younger seniors expecting that they may be around for one to three more decades to come.
If you are 65 and your spouse is 60, you qualify for roughly 51% of the appraised value of the home to receive in the form of a reverse mortgage.