A reverse mortgage does not affect Social Security retirement or Medicare. Need-based programs like Medicaid and SSI are different. How and when you use the money matters.
The basic rule
Reverse mortgage proceeds are a loan, so they are not counted as income in the month you receive them. But if you hold onto the money into the next month, it can count as an asset. For programs with strict asset limits, that can affect eligibility.
A line of credit you have not drawn on is generally not counted. That makes a line of credit a common choice for people who rely on need-based benefits, so they draw only what they spend.
Before you decide
- Tell your HUD-approved counselor about any benefits you receive
- Talk with a benefits advisor or elder law attorney in Kansas or Missouri
- Plan to draw funds only as you need them
- Keep records of how funds are spent
Common questions
Will a reverse mortgage reduce my Social Security?
No. Social Security retirement benefits are not based on income or assets, so loan proceeds do not change them.
Does it affect Medicare?
No. Medicare is not need-based.
Can a reverse mortgage pay for home care so I can avoid a nursing home?
Many people use monthly payments or a line of credit for in-home care. If you are out of the home more than 12 consecutive months, the loan generally comes due.
Related: How it works · Who qualifies · Costs · For families · FAQ · Service areas
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Steve Clune is a licensed loan officer for Kansas and Missouri. Call or text with your questions. If you miss him, send a text and he’ll get back to you.