Proprietary Reverse Mortgages: Flexibility Beyond FHA

When a traditional HECM doesn’t fit, due to home value, condo approval, or borrower age, proprietary reverse mortgages provide private-market solutions designed for such real-life and unique homeowner scenarios.

These programs are lender-specific, non-FHA-insured, and typically available to borrowers aged 55 and older (varies by lender and state).

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What is a Proprietary Reverse Mortgage?

A Proprietary Reverse Mortgage is a private, non-FHA reverse mortgage program created by individual lenders.

It’s designed for homeowners who don’t qualify for FHA-insured HECM due to property type, age of a spouse, or lending limits, or for those who simply want more flexible terms.

Unlike the one-size-fits-all FHA program, proprietary reverse mortgages are custom solutions by lenders to cover situations where traditional rules fall short.

Key Benefits of a Proprietary Reverse Mortgage

No FHA approval needed

If your condo or property doesn’t meet FHA requirements, you can still qualify and unlock your equity without roadblocks under a proprietary reverse mortgage.

Access more equity

Proprietary loans go beyond FHA limits, giving you the ability to borrow larger amounts and custom payout options from higher-value homes.

Spouse flexibility

Some proprietary programs allow younger non-borrowing spouses to be included or protected under the loan terms, helping protect your family’s long-term security.

Choose how you get cash

Take funds as a lump sum, steady monthly income, a line of credit you can draw on later, or combine them to fit your retirement plan. Payout options and growth features depend on the specific lender’s product design.

Built-in family protection

Most proprietary reverse mortgages are non-recourse, meaning, you and your heirs will never owe more than the home’s value when it’s sold, no matter how the housing market performs. Confirm with your lender, as terms vary.

Common Uses of a Proprietary Reverse Mortgage

Tap into equity from high-value homes → If your property is worth more than FHA limits allow, proprietary options let you unlock more of its value.
Finance condos that aren’t FHA-approved → Don’t be limited by strict government rules; access funds even if your condo doesn’t qualify for HECM.
Protect a younger spouse → Some proprietary programs allow younger non-borrowing spouses to stay protected, giving your family financial security.
Cover health or long-term care expenses → Use your home’s equity to manage medical bills, in-home care or future planning needs without draining savings.
Boost retirement cash flow → Create financial breathing room while keeping ownership of the home you love.

Ways Loan Proceeds Can Be Taken

Lump Sum→ Get a one-time payout for major expenses like medical bills, debt payoff, or home improvements.
Monthly Payments → Create a steady stream of income to supplement retirement and cover everyday living costs.
Line of Credit → Draw funds only when you need them, with unused credit growing over time for added flexibility.
Hybrid Option → Combine payout methods to design a cash-flow plan that matches your retirement goals.

Do You Qualify for a Proprietary Reverse Mortgage?

If you are wondering whether this option is open to you, here’s the good news: most homeowners who don’t fit FHA’s strict rules often qualify here.

Your Age → If you’re 55 or older (some lenders and states vary)
Your Home → This has to be your primary residence, the place you live most of the year.
Your Equity → If you have built up at least 50% equity, or own your home outright, you’re in a strong position.
Your Next Step → A quick counseling session is required so you know exactly how the program works before moving forward.

Eligible Properties for Proprietary Reverse Mortgages

This is where Proprietary Reverse Mortgages shine; they cover the property types that FHA leaves out.

1. Condos that aren’t FHA-approved

2. High-value homes well above government loan limits.

3. 2–4 unit properties (as long as you live in one).

4. Select manufactured homes, depending on the lender’s rules and HUD construction standards.

How a Proprietary Reverse
Mortgage Works?

Application with TFG

We match you to the best-fit proprietary program.

Property Review

Condo, high-value home, or non-standard property checked for eligibility.

Appraisal & Underwriting

Terms structured based on lender-specific rules.

Closing

Finalize loan, choose payout method.

Post-Closing

No monthly mortgage payments required; you stay responsible for taxes, insurance, and maintenance.

Real Stories from Homeowners Like You

“We built equity in our home over decades, but FHA limits capped us. TFG guided us into a Jumbo Reverse that unlocked nearly twice the amount we’d qualify for with HECM.”

Steven & Margaret T.

California

“The process was smooth, and we were able to use part of our equity for estate planning while still staying in the home we love.”

Michael P.

Florida

Frequently asked questions

How is a proprietary reverse mortgage different from HECM?

A HECM is federally insured by the FHA with standardized rules and lending limits. Proprietary reverse mortgages are privately funded by lenders, giving more flexibility for higher-value homes, non-FHA-approved condos, or younger spouses.

Are proprietary programs safe?

Yes. While not FHA-insured, they are offered by established lenders and still carry the same non-recourse protection: you or your heirs will never owe more than the home’s value at sale.

Do I keep ownership of my home in Proprietary Reverse Mortgage?

Absolutely. Just like with a HECM, your name stays on the title, and you keep full ownership and the right to live in your home.

What is a proprietary reverse mortgage?

It’s a private reverse mortgage program created by lenders to serve homeowners who don’t qualify for HECM or who need more flexibility. It unlocks home equity without monthly mortgage payments, tailored to unique property types or higher-value homes.

What is the minimum age to Qualify?

Most proprietary programs start at age 60+, though some lenders set higher age requirements. Exact eligibility depends on the lender’s guidelines.

Explore Other Options

If proprietary isn’t the right fit, you may qualify for:

HECM Reverse Mortgage

Federally insured, standardized option for most seniors

Jumbo Reverse Mortgage

For very high-value homes well above FHA caps