HECM vs. Proprietary Reverse Mortgages: Which Retirement Mortgage Strategy Is Right for You?

In this episode I cover a topic a client brought to me after moving from Washington State to Colorado: the key differences between an FHA-insured Home Equity Conversion Mortgage (HECM) and a non-FHA proprietary reverse mortgage. Whether you are looking to relocate closer to family or unlock equity in your home without a required monthly mortgage payment, understanding these two options is essential for smart retirement planning. We break down how the traditional HECM—often referred to as the "Cadillac" of reverse mortgages—offers lower interest rates, a growing line of credit, and FHA backing for homeowners age 62 and older. On the flip side, I explain why a proprietary reverse mortgage might be a better fit if you are between 55 and 61, own a higher-value jumbo property of $4 million or more, or want to avoid the 2% upfront mortgage insurance premium while paying off existing consumer debt at closing. I also share real-life case studies from Scottsdale and discuss how top retirement researchers like Dr. Wade Pfau view these tools as strategic assets rather than loans of last resort. Subscribe to my channel to learn which product fits your retirement goals and how to schedule a personal consultation.