Reverse Mortgages in Florida: How a HECM Works in Miami and South Florida

Short answer

A reverse mortgage in Florida lets a homeowner age 62 or older turn home equity into cash with no monthly mortgage payment, as long as the home stays the principal residence and taxes, insurance and HOA dues are paid. The FHA-insured version, the Home Equity Conversion Mortgage (HECM), can use a home value of up to $1,249,125 in 2026, and every borrower must first complete counseling with a HUD-approved counselor. The loan is usually repaid when the last borrower sells, moves out or dies.

HECM basics: who qualifies, as of October 2026

Most reverse mortgages are HECMs, insured by FHA and regulated by HUD. The core rules come from HUD and the CFPB:

• Age: 62 or older.
• Occupancy: the home must be your principal residence. Second homes and rentals do not qualify.
• Equity: you own the home outright or have paid down a considerable amount. Any existing mortgage is paid off from the reverse mortgage proceeds.
• Federal debt: you cannot be delinquent on any federal debt.
• Ability to keep up the home: the lender verifies income, assets, expenses and credit, including on-time payment of property taxes and insurance.
• Counseling: you must meet with a HUD-approved HECM counselor before you apply. More on that below.
• Property: a single-family home, a 2-4 unit home where you live in one unit, a condo in a HUD-approved project or a unit with FHA single-unit approval, or an FHA-compliant manufactured home. Co-op units are not eligible.

The 2026 limit: HUD Mortgagee Letter 2025-22 set the HECM maximum claim amount at $1,249,125 for case numbers assigned on or after January 1, 2026. That is 150% of the national conforming limit of $832,750. It is not the amount you receive. It is the cap on the home value used to size the loan.

How much you can actually get depends on the age of the youngest borrower or eligible non-borrowing spouse, current interest rates, and the lesser of the appraised value, the HECM limit, or the sales price on a purchase. Rates vary daily; call 305-425-1990 for a current estimate.

Counseling, costs and how you get paid

Counseling comes first. HUD requires a session with a HUD-approved HECM counselor. It covers eligibility, the financial effects, alternatives, and what makes the loan come due. HUD's toll-free line to find a counselor is (800) 569-4287. The CFPB's search tool for HUD-approved counseling agencies lists the languages each agency offers; as of October 2026, a search near Doral shows a HUD-approved agency that offers reverse mortgage counseling in Spanish.

Costs HUD lists for a HECM:

• Initial mortgage insurance premium: 2%, charged at closing.
• Annual mortgage insurance premium: 0.5% of the outstanding balance, for the life of the loan.
• Origination fee: the greater of $2,500 or 2% of the first $200,000 of home value plus 1% above $200,000, capped at $6,000. Example: on a $300,000 home, that is $4,000 plus $1,000, or $5,000.
• Servicing fee: up to $30 a month on fixed or annually adjusting loans, up to $35 on monthly adjusting loans.
• Third-party costs: appraisal, title, inspections, recording and Florida taxes on the mortgage.

Most costs can be paid from the loan, which lowers what you take home.

Payout options:

• Fixed rate: a single lump sum at closing.
• Adjustable rate: tenure (monthly payments as long as you live in the home), term (monthly payments for a set number of months), a line of credit, or a modified tenure or modified term plan that combines monthly payments with a line of credit.

Your obligations, your spouse, and how the loan is repaid

A reverse mortgage is not free money. Interest and fees are added to the balance every month, so the balance grows and your equity shrinks. The title stays in your name.

What you must keep doing: live in the home as your principal residence, keep it in good condition, and pay property taxes, homeowners and flood insurance, and HOA or condo fees. HUD checks that you have the resources for these before closing. The CFPB warns that if you fall behind on taxes or insurance, the servicer may treat the loan as in default and you could face foreclosure.

Non-borrowing spouse: if your spouse is younger than 62 and not on the loan, HUD allows an eligible non-borrowing spouse's age to be used when sizing the loan, which lowers the amount available. In exchange, an eligible non-borrowing spouse may be able to stay in the home after the borrower dies, under a deferral, as long as he or she keeps living there as a principal residence and meets HUD's other conditions. The deferral ends if the spouse moves out. Make sure your spouse is named correctly at closing.

When it comes due: usually when the last borrower dies, sells, or moves out, or if the loan obligations are not met. Heirs can keep the home by paying the full loan balance, or sell it. The CFPB says that if the balance is more than the home is worth, heirs can settle by selling for at least 95% of the appraised value, and the mortgage insurance covers the rest. After a due-and-payable notice, heirs have 30 days to act, which may be extended up to six months to sell or arrange financing.

HECM for Purchase and proprietary (jumbo) reverse mortgages

HECM for Purchase lets a buyer 62 or older buy a new principal residence with a reverse mortgage, with no monthly mortgage payment afterward. It is common for retirees who sell a larger home and downsize. Key rules:

• You pay the difference between the HECM proceeds and the price, plus closing costs, in cash. Under HUD Mortgagee Letter 2009-11, that money must come from cash on hand or the sale of your own assets, such as the old house.
• Bridge loans, credit card advances, personal loans and seller financing cannot fill the gap.
• You must move in within 60 days of closing.
• The CFPB notes closing costs are higher than on other reverse mortgages.

Proprietary reverse mortgages are private loans not insured by FHA. Some lenders offer them for homes worth more than the HECM limit, which is why they are often called jumbo reverse mortgages. Ages, fees, payout choices and condo rules are set by each lender, not HUD, and they do not carry FHA mortgage insurance. Compare the total cost and the protections, especially for a non-borrowing spouse, against a HECM before choosing one.

Florida specifics: homestead, condos and insurance

Homestead exemption. Florida's homestead exemption can cut a home's taxable value by as much as $50,000 when it is your permanent residence, according to the Florida Department of Revenue. A HECM keeps the title in your name and requires that you live there, so a reverse mortgage by itself generally does not change homestead status. The risk is moving out: that can end the exemption and make the loan come due. See what is a homestead exemption.

Condos. Many South Florida seniors live in condos. For a HECM, the project must be HUD-approved or the unit must get FHA single-unit approval. Older towers with milestone inspections, reserve requirements or special assessments can struggle in FHA review, and higher HOA dues count against your budget in HUD's financial check. Send us the building address before you apply.

Insurance and flood. HUD requires hazard insurance and, where it applies, flood insurance, and it looks at your record of paying them. In South Florida these are often among the largest housing costs, so plan for premiums to change at renewal. If the budget is tight, a reverse mortgage may not be the right fit, and that is exactly what counseling should test.

Alternatives to compare. A HELOC or a fixed second mortgage keeps your current first mortgage in place but requires monthly payments. A sale and downsizing may cost less than any loan. We price a HELOC next to a reverse mortgage review so you can compare.

How QMS Lending helps

QMS Lending (NMLS #1781090) is an independent mortgage broker in Miami, FL, licensed in Florida and working with 100+ lenders. We review your home, your building, your spouse's situation and your budget, explain the options in English or Spanish, and help you compare a reverse mortgage with a HELOC, a refinance or a sale. You may qualify; every loan is subject to approval and to completing HUD-approved counseling first. Contact us or call 305-425-1990.