# VA Reverse Mortgage: What Veterans Can Use in 2026
> There is no VA reverse mortgage. Veterans 62+ can use FHA's HECM, which can pay off a VA loan. The 2026 limit, MIP, spouse rules, scams and alternatives.
Source: https://veteranhomematch.com/learn/va-reverse-mortgage
*Author:* VeteranHomeMatch Editorial Team
*Reviewed by:* VeteranHomeMatch Editorial Review
*Published:* 2026-10-24
*Updated:* 2026-10-24
---
There is no VA reverse mortgage. The [CFPB says it directly](https://www.consumerfinance.gov/ask-cfpb/what-is-a-reverse-mortgage-en-224/): "The Department of Veterans Affairs (VA) does not offer any reverse mortgage loans." What older veterans can use is FHA's Home Equity Conversion Mortgage (HECM), the federally insured reverse mortgage for homeowners 62 and older, and it can pay off an existing VA loan at closing. Whether it's the right move depends on your age, your equity, who else lives in the house, and what the VA-backed alternatives would cost you.
- **VA doesn't make or guarantee reverse mortgages.** The main federally insured option is FHA's HECM, open to homeowners 62 and older, veteran or not.
- **A HECM can pay off your VA loan.** Any mortgage balance has to be paid off at closing, either from your own money or from the reverse mortgage itself.
- **2026 numbers:** HUD caps the maximum claim amount at **$1,249,125**. Mortgage insurance is **2% upfront** on the maximum claim amount and **0.50% a year** on the balance.
- **Counseling isn't optional.** The borrower, any non-borrowing spouse, and any non-borrowing owner must get counseling from a HUD-approved counselor before closing.
- **A spouse who isn't on the loan may be able to stay**, but only if they meet HUD's Eligible Non-Borrowing Spouse conditions, which are set at closing.
- **Mailers that pitch a "VA reverse mortgage" or a "no-payment" loan** are a known warning sign. VA has said it doesn't mail or email solicitations for its loan program.
## Does VA offer a reverse mortgage?
No. [VA's home loan programs](https://www.va.gov/housing-assistance/home-loans/loan-types/) are a purchase loan, a cash-out refinance, the interest rate reduction refinance (IRRRL) and the Native American Direct Loan. None of them is a reverse mortgage. When an ad or a lender says "VA reverse mortgage," it usually means one of two things: an FHA-insured HECM marketed to veterans, or a private ("proprietary") reverse mortgage, which isn't a HECM and isn't covered by HUD's HECM rules.
The difference is real. A HECM is regulated under [24 CFR Part 206](https://www.law.cornell.edu/cfr/text/24/206.27) and insured by FHA, with mandatory counseling and spouse protections written into the rules. A proprietary product follows whatever its contract says. If someone pitches you a reverse mortgage, ask what the program is called on the disclosures.
## How a HECM works for a veteran with a VA loan
A HECM turns home equity into cash without a monthly mortgage payment. Per the [CFPB](https://www.consumerfinance.gov/ask-cfpb/what-is-a-reverse-mortgage-en-224/), interest and fees are added to the balance each month, so what you owe grows over time and your equity shrinks. You still owe property taxes, homeowners insurance and upkeep.
If you still owe on a VA loan, that loan gets paid off first. The [CFPB's eligibility page](https://www.consumerfinance.gov/ask-cfpb/can-anyone-take-out-a-reverse-mortgage-loan-en-227/) puts it this way: "If you have a mortgage balance, you must be able to pay it off when you close on the reverse mortgage." You can use your own money or HECM proceeds to do it. In practice, a large VA balance eats much of what the HECM can provide.
### Who qualifies
From the federal regulation and the CFPB's eligibility list:
| Requirement | What the rule says |
| --- | --- |
| Age | The youngest borrower must be **62 or older** at closing ([24 CFR 206.33](https://www.law.cornell.edu/cfr/text/24/206.33)) |
| Occupancy | The home must be the **principal residence** of each borrower, and of any Eligible Non-Borrowing Spouse, at closing ([24 CFR 206.39](https://www.law.cornell.edu/cfr/text/24/206.39)) |
| Existing mortgage | Must be **paid off at closing**, with your own funds or HECM proceeds |
| Federal debt | You can't owe federal debt such as federal income taxes or federal student loans, though HECM money can be used to pay it off |
| Ongoing costs | Enough of your own money, or a set-aside from the loan, for property charges, maintenance and repairs |
| Counseling | Required from a HUD-approved counselor ([24 CFR 206.41](https://www.law.cornell.edu/cfr/text/24/206.41)) |
### How much you can borrow
You can't borrow the full value of the house. HUD's regulation defines the **maximum claim amount** as the lesser of the appraised value, the sales price on a HECM for Purchase, or the national limit ([24 CFR 206.3](https://www.law.cornell.edu/cfr/text/24/206.3)). For FHA case numbers assigned January 1 through December 31, 2026, [HUD Mortgagee Letter 2025-22](https://www.hud.gov/sites/dfiles/hudclips/documents/2025-22hsgml.pdf) sets that limit at **$1,249,125**, which is 150% of Freddie Mac's $832,750 national conforming limit.
What you can actually draw is the **principal limit**, which HUD calculates from the age of the youngest borrower (or Eligible Non-Borrowing Spouse), the expected interest rate, and the maximum claim amount. A lender's quote and your counseling session will show the number for your situation.
## What a HECM costs in 2026
FHA charges two mortgage insurance premiums on a HECM. Under [HUD Mortgagee Letter 2017-12](https://www.hud.gov/sites/documents/17-12ml.pdf), effective for HECMs with FHA case numbers assigned on or after October 2, 2017, the initial premium is "two percent (2.00%) of the Maximum Claim Amount" for every borrower, and the annual premium is "one-half of one percent (0.50%) of the outstanding mortgage balance." The annual premium isn't paid out of pocket. It's added to the balance along with interest.
On a $400,000 home, that works out to an **$8,000** upfront premium, and about **$500 a year** of added premium for each $100,000 you owe. The bars below set the HECM premium beside the VA funding fee on the most common VA alternative, a cash-out refinance. Watch the base: HECM's 2% is charged on the home's value (up to the cap), while VA's fee is charged on the loan amount.
The VA figures come from [VA's funding fee table](https://www.va.gov/housing-assistance/home-loans/funding-fee-and-closing-costs/): 2.15% for first use and 3.3% after first use on a cash-out refinance, regardless of equity. If you're refinancing a VA loan you already used your benefit on, plan on the after-first-use rate. Veterans receiving VA compensation for a service-connected disability don't pay a funding fee at all. The [funding fee calculator](/calculator/funding-fee) runs your own numbers.
Under [24 CFR 206.27](https://www.law.cornell.edu/cfr/text/24/206.27), the balance becomes due when the last surviving borrower dies (subject to the spouse deferral below), or when the borrowers transfer title. With HUD's approval, it can also become due if the home is no longer the principal residence of any borrower, if a borrower is away more than 12 consecutive months because of physical or mental illness and no other borrower lives there, if property taxes and other property charges aren't paid, or if another loan obligation isn't met. The loan is non-recourse: the lender collects only through sale of the home and can't get a deficiency judgment against you.
## Your VA loan, entitlement and disability compensation
Paying off a VA loan with a HECM doesn't automatically hand your entitlement back. [VA's eligibility page](https://www.va.gov/housing-assistance/home-loans/eligibility/) lets you restore used entitlement if you've repaid the prior loan in full but haven't sold the home, and "you can only do this once." You'd request it through a Certificate of Eligibility, online, through a lender, or on VA Form 26-1880.
For most HECM borrowers, that restoration is more theory than plan. A VA purchase loan is for a home you'll live in, and a HECM can come due once the house stops being your principal residence. Buying and moving to a new home would generally mean repaying the HECM. If restored entitlement matters to you, raise it in counseling before you close. Our [VA entitlement calculator](/learn/va-entitlement-calculator) explains how full and partial entitlement are counted.
A disability rating matters more on the VA side of this decision. VA compensation for a service-connected disability waives the funding fee on a cash-out refinance, and in some states a rating can cut the property taxes a HECM requires you to keep paying. Our guide to [disabled veteran property tax exemptions](/learn/va-property-tax-exemptions-disabled-veterans) covers what six states ask for.
## Protections for a spouse who isn't on the loan
This is the part that's easiest to miss, and the hardest to fix later. A spouse under 62 can't be a HECM borrower, because the youngest borrower must be 62 at closing. The regulation does offer that spouse a path to stay in the home, but only one that's set up at closing.
Under [24 CFR 206.55](https://www.law.cornell.edu/cfr/text/24/206.55), a non-borrowing spouse qualifies for a **Deferral Period** after the borrower dies only if they:
1. were the borrower's spouse at closing and stayed married for the borrower's lifetime,
2. were disclosed to the lender and specifically named as an Eligible Non-Borrowing Spouse in the loan documents,
3. have lived in the home as their principal residence and keep doing so, and
4. within 90 days of the borrower's death, establish legal ownership or another legal right to remain in the home for life, and keep meeting the loan's other obligations, such as paying property charges.
The deferral lets the spouse stay. It doesn't let them keep drawing money: the regulation says disbursements can't continue during a Deferral Period. A spouse who doesn't meet the conditions at closing is an Ineligible Non-Borrowing Spouse, and the HECM becomes due when the last surviving borrower dies. Counselors are required to explain what happens to the spouse, and the spouse must attend counseling too.
## Reverse mortgage scams aimed at veterans
The CFPB names the pattern: "Some mortgage ads falsely promise veterans special deals, imply VA approval, or offer a 'no-payment' reverse mortgage loan to attract older Americans desperate to stay in their homes." Red flags to watch for:
- **VA seals or "VA-approved" language on a reverse mortgage mailer.** In a [2015 CFPB post](https://www.consumerfinance.gov/about-us/blog/the-va-doesnt-send-you-mortgage-ads/), VA's then home loan director said: "VA will never email or mail out solicitations for our loan program." He added: "VA does not endorse or sponsor any particular lender."
- **"No payments ever."** You owe no monthly mortgage payment, but you still owe taxes, insurance and upkeep, and not paying property charges can make the loan due.
- **A contractor or "estate planner" who pushes the loan.** The CFPB warns against contractors selling a reverse mortgage to pay for repairs, and HECM counselors must ask whether you've signed with an estate planning service firm.
- **Pressure to sign fast.** With most reverse mortgages you can cancel within three business days after closing. The CFPB says: "Within three business days after the loan is closed, you can cancel the deal for any reason, without penalty."
If an ad looks deceptive, you can file a complaint with the CFPB. For questions about your VA loan, you can reach a VA loan technician at 877-827-3702.
## Alternatives to a reverse mortgage
| Option | Who it fits | Monthly payment? | Main trade-off |
| --- | --- | --- | --- |
| **HECM (FHA reverse mortgage)** | 62+, home is your principal residence, solid equity | None on the loan; taxes, insurance and upkeep continue | Balance grows; less equity for heirs; 2% + 0.50% MIP |
| **VA cash-out refinance** | Any age, with a VA Certificate of Eligibility, credit and income that qualify | Yes, a new mortgage payment | Reprices your whole balance; funding fee unless exempt |
| **Home equity loan or HELOC** | Any age, with a lender willing to lend in second position | Yes | Not a VA product; your current first mortgage stays put |
| **VA Partial Claim Program** | Behind on a VA-guaranteed loan | Yes, your regular mortgage payment | Requires a 3-month trial plan; the partial claim is repaid when you pay off the loan or sell |
### VA cash-out refinance
[VA's cash-out refinance](https://www.va.gov/housing-assistance/home-loans/loan-types/cash-out-loan/) replaces your current loan with a new one and lets you take cash from your equity. It can also refinance a non-VA loan into a VA-backed one. You need a Certificate of Eligibility, you have to meet VA's and the lender's credit and income standards, and you have to live in the home. Unlike a HECM, it comes with a monthly payment. Our [VA cash-out refinance guide](/learn/va-cash-out-refinance) covers the 100% loan-to-value ceiling and the net tangible benefit tests.
### Home equity loan or HELOC
There's no [VA home equity loan](/learn/va-home-equity-loan), but you can put an ordinary home equity loan or line of credit behind a VA first mortgage. The CFPB describes a home equity loan as one that "allows you to borrow money using the equity in your home as collateral," and warns: "If you cannot pay back the HEL, the lender could foreclose on your home." This route keeps a low-rate VA loan in place, which a HECM or cash-out refinance won't.
### If you're behind on your VA loan
A reverse mortgage isn't the only way out of missed payments. VA's [Partial Claim Program](/learn/va-partial-claim-program) lets VA work with your servicer to pay your missed payments and bring the loan current, and you repay the partial claim when you pay off the loan or sell. VA says you must first complete a 3-month trial payment plan, and that servicers have until November 28, 2026, to add partial claims to their systems. Call your servicer first; a VA loan technician at 877-827-3702 can also talk through the options.
### Still working, or just leaving the service?
If you're years away from 62, this is a later problem, but the loan you carry into retirement is decided earlier. Our guide to [a VA loan before retiring from the military](/learn/va-loan-retiring-from-military) covers how retired pay and a disability rating line up in your final year.
## Bottom line
A VA reverse mortgage doesn't exist. If you're 62 or older and want to stop making a mortgage payment, an FHA HECM can pay off your VA loan, with 2% upfront and 0.50% annual mortgage insurance, mandatory counseling, and spouse protections that only work if they're set up at closing. If you'd rather keep a payment and keep more of your equity, a VA cash-out refinance or a second lien may fit better, and if you're behind on payments, ask your servicer about the Partial Claim Program first. To compare the VA-backed options against your actual balance, start with the [2-minute eligibility check](/start/loan-purpose).
## Frequently asked
### Does the VA offer a reverse mortgage?
No. The CFPB states plainly that the Department of Veterans Affairs does not offer any reverse mortgage loans. The federally insured reverse mortgage available to veterans is FHA's Home Equity Conversion Mortgage (HECM), which is open to any homeowner 62 or older who meets HUD's rules, veteran or not.
### Can I get a reverse mortgage if I still have a VA loan?
Yes, if you have enough equity. The CFPB says that if you have a mortgage balance, you must be able to pay it off when you close on the reverse mortgage, using your own funds or money from the reverse mortgage. So the HECM pays off the VA loan at closing, and whatever is left over is what you can actually draw.
### What are the HECM costs in 2026?
Under HUD Mortgagee Letter 2017-12, the upfront mortgage insurance premium is 2% of the maximum claim amount and the annual premium is 0.50% of the outstanding balance. The maximum claim amount is the lesser of the appraised value or the national limit, which HUD set at $1,249,125 for case numbers assigned in 2026. Lender fees, counseling and closing costs come on top.
### Does paying off my VA loan with a reverse mortgage restore my entitlement?
It may. VA lets you restore used entitlement if you've repaid the prior loan in full but haven't sold the home, and you can do that only once. You still have to request the restoration through a Certificate of Eligibility. Keep in mind that a HECM can become due if the home stops being your principal residence, so buying and moving to another home would generally trigger repayment.
### Can my spouse stay in the house if they aren't on the reverse mortgage?
Possibly. Under 24 CFR 206.55, an Eligible Non-Borrowing Spouse can defer repayment after the borrower dies if they were married to the borrower at closing, were named in the loan documents, keep living in the home as their principal residence, and establish a legal right to stay within 90 days of the death. A spouse who doesn't meet those conditions gets no deferral, and the loan becomes due when the last borrower dies.