With a reverse mortgage Washington lenders make available, you use your home's value as collateral, and $260,960 is the median initial cap here. There are no monthly loan payments as long as you live in the home. The data comes from 861 federally insured loans statewide, with a median home value of $598,000 for those borrowers. During fiscal year 2025, 1,186 households in the state took out these federal loans. Among them, 104 homeowners refinanced their loans and 40 purchased a home. To find out how the interest builds up, you can look at how a reverse mortgage works.
Washington's rules for private loans beginning at age 60
The federal HECM program is what most borrowers pick, and it sets a minimum age of 62 in every state. But in Washington, 61 borrowers recently hit the federal HECM lending limit, which is $1,249,125. People whose homes are worth more sometimes consider a proprietary reverse mortgage as an alternative. That's a private loan from a lender that doesn't carry federal insurance. Washington proprietary reverse mortgage rules say a lender can't issue a private reverse loan to any state resident who is younger than 60.
The lender can't accept your completed application or charge you for a private loan until they've referred you for counseling at a HUD-approved agency. Washington is home to 3 of these independent counseling agencies. The lender is required to collect a signed certificate confirming you finished the counseling. Private borrowers also get the same rescission right that the federal Truth in Lending Act provides, thanks to state rules. After a loan closes, rescission gives you the legal right to cancel it. The only way a lender can recover what's owed is by selling the property. When a sale falls short, a deficiency judgment that asks you for more money is not available to them.
Property tax relief in King County and statewide, for incomes under $88,998
Federal reverse mortgage rules across the country require you to stay current on property taxes and homeowners insurance. You're also required to live in the property as your primary home and keep it well maintained. The loan can go into default if you fall behind on property taxes. Local tax relief programs are important for this reason. The Washington Department of Revenue lists the income thresholds that apply statewide for exemptions and deferrals for seniors and disabled people.
These programs are handled by local assessors. You can get a tax exemption under King County senior tax relief rules when your 2025 yearly income, counting Social Security, was below $84,000. You need to be 62 or older the first year you apply, or you must have a disability, or you must be a qualifying veteran. You can also put off property taxes in King County once you're 60, or if a physical disability forced you to retire. To qualify for a deferral, your 2025 household income can't go above $88,998. Your home gets a lien placed on it for any deferred taxes plus interest. Selling the house repays the lien, which is a legal claim.
Can the Department of Financial Institutions help if you have a problem with a lender?
You can file a complaint about mortgage lenders, servicers or consumer loan companies with the Washington State Department of Financial Institutions. You can call 1-877-746-4334 or write to PO Box 41200, Olympia, Washington 98504. Reverse mortgage lenders and their brokers in Washington need a state license according to state Consumer Loan Act definitions, unless federal law says they don't. Through the NMLS system, the agency handles Consumer Loan Company licensing. At the moment, 111 active lenders provide federal reverse loans in the state.
