How to Avoid Reverse Mortgage Foreclosure
It's Rare — and Almost Always Preventable
JP Dauber · Licensed HECM Specialist
NMLS# 386298 · Published June 15, 2026
What are the three borrower obligations?
A HECM has no monthly mortgage payment. But it does have three ongoing requirements — the same things you'd do as any homeowner:
Pay property taxes
Stay current on your property tax bills. A LESA can handle this automatically if you prefer.
Maintain insurance
Keep your homeowner's insurance active. Flood insurance too, if required. Don't let policies lapse.
Live in the home
The home must remain your primary residence. Moving out for 12+ consecutive months triggers the loan becoming due.
That's it. Meet these three requirements and the loan stays in good standing for as long as you live there.
What actually triggers HECM foreclosure?
The vast majority of HECM foreclosures stem from one issue: falling behind on property taxes. This often happens gradually — a missed payment leads to a penalty, which makes the next payment harder, and the problem snowballs.
The good news: foreclosure doesn't happen overnight. The servicer is required to follow a lengthy notification and cure process. You'll receive multiple notices and opportunities to catch up before any legal action begins. The key is to act early — don't ignore the letters.
What should you do if you fall behind?
Contact your servicer immediately
Don't wait for them to contact you. They have options available — repayment plans, using remaining HECM proceeds, and other solutions. But they can only help if you communicate.
Check for state and local assistance programs
Many states offer property tax deferral programs, senior tax exemptions, and emergency assistance for homeowners. Your county assessor's office or area agency on aging can point you in the right direction.
Contact a HUD housing counselor
Free counseling is available through HUD-approved agencies. They can help you understand your options, negotiate with the servicer, and develop a plan. Call 1-800-569-4287.
Stay current, stay home
Reverse mortgage foreclosure is rare and almost always preventable. The obligations are straightforward: pay your taxes, keep your insurance, and live in the home. If you hit a rough patch, help is available — from your servicer, from state programs, and from HUD counselors. The worst thing you can do is ignore the problem.
Questions about staying in good standing with your HECM? Reach out — I can help you understand your obligations and make sure you're set up for success.
Keep reading
More on Common Concerns
Reverse Mortgage Age: What If Your Spouse Is Under 62? →
You can still get a HECM if your spouse is under 62. They become a non-borrowing spouse with stay-in-home protections. Here's how it works.
Reverse Mortgage Scams: How to Protect Yourself →
The program is legitimate — but bad actors exist. Here are the real scams and how to stay safe.
Can You Travel or Snowbird With a Reverse Mortgage? →
Yes — you can travel, snowbird, and spend months away. The one rule: your HECM home must stay your primary residence.
What Happens to a Reverse Mortgage If Property Values Drop? →
You're protected — the non-recourse guarantee means you can never owe more than your home is worth.
What Happens to a Reverse Mortgage in a Divorce? →
Who keeps the home, what happens to the loan, and the NBS risk most people miss.
Non-Borrowing Spouse: How to Protect a Younger Spouse →
If your spouse is under 62, the NBS designation keeps them in the home for life.