HomeBridge · Texas · 9 min read · Updated June 2026

Best Reverse Mortgage Options for Texas Homeowners 62+ (2026 Guide)

Texas is home to one of the largest and fastest-growing 62+ populations in the United States. With Dallas alone counting 88,714 seniors and market values ranging from $320,000 in the metro area to $421,000 in Mansfield, Texas presents distinct opportunities — and a few specific state rules — for homeowners considering a HECM reverse mortgage. This guide covers the 2026 landscape for Texas reverse mortgage borrowers.

Texas 62+ housing market — 2026 numbers

Texas's major metros have seen significant home value appreciation over the past decade, which directly benefits reverse mortgage borrowers. Higher home values mean higher principal limits. Here are key markets for 2026:

Dallas's large senior population and moderate-to-mid home values create an active HECM market. The $320,000 average home value generates a meaningful principal limit for a 62+ homeowner — and Mansfield's higher average gives homeowners there access to even more substantial proceeds.

Both markets fall well below the 2026 FHA lending limit of $1,249,125, so the cap does not restrict most Texas homeowners. A notable exception: homeowners with luxury properties in Dallas's toniest neighborhoods may exceed the limit and need to explore jumbo reverse mortgage products.

Texas-specific rules that affect your HECM

Texas has a few regulatory features that distinguish it from most other states:

12-day funding waiting period. Texas requires a mandatory 12-day waiting period between HECM loan approval and fund disbursement. This is the longest such waiting period in the country. The purpose is to give borrowers a formal cooling-off window — time to ask questions, review documents, and confirm the decision. Most other states have no equivalent requirement. Note that this applies to the initial disbursement; draws on an established line of credit are not subject to the waiting period.

Texas Constitution protections. Texas has unusually strong homeowner protections embedded in its state constitution, including restrictions on non-recourse loans. Texas law historically limited the use of non-recourse reverse mortgages, which is why the Texas Reverse Mortgage (txHECM) was developed as a separate product. The good news: Texas homeowners have access to both the standard HECM and the txHECM, depending on the lender.

No state income tax. Texas has no state income tax. HECM proceeds — classified as loan advances, not income — are not subject to Texas state income tax. Federally, they are generally not taxable income either, though you should consult a tax advisor for your specific situation.

Disbursement options — choosing the right structure

Texas HECM borrowers can choose from the same disbursement structures available in other states. Here is a breakdown:

• Lump sum — The full available principal limit is disbursed at closing. Best for borrowers who need a large cash amount immediately — for home repairs, medical expenses, or debt payoff. Note the 12-day Texas waiting period applies to this first disbursement.
• Line of credit — Funds are available to draw as needed. The unused portion of a HECM line of credit grows over time at the same rate as the loan interest — meaning your available credit can increase even if you never draw. This is often the most flexible option for ongoing needs.
• Monthly tenure payments — Fixed monthly payments for as long as you remain in the home. Best for supplementing fixed retirement income over the long term. Payments continue until the home is sold, vacated, or the loan reaches its term limit.
• Monthly term payments — Fixed monthly payments for a set number of years (e.g., 5, 10, 15 years). Useful for a known expense window, such as funding a grandchild's education or bridging to a pension start date.
• Combination — A common approach: take some as a lump sum at closing (subject to the 12-day wait), establish a line of credit for unexpected needs, and set up monthly payments for regular cash flow.

The right structure depends on your income needs, your plans for the home, and whether you want to preserve a growing line of credit as a safety net.

Property tax considerations for Texas homeowners

Texas homeowners 65+ have access to significant property tax relief through two mechanisms:

• School Tax Ceiling — Homeowners 65+ can freeze their school taxes at the amount owed in the year they qualify, preventing future increases. This is a substantial benefit in markets where school taxes escalate.
• Homestead Exemption — All Texas homeowners can claim a homestead exemption that reduces the taxable value of their home. For seniors, this is typically an additional exemption on top of the standard homestead protection.

A reverse mortgage does not affect your ability to claim these exemptions — but you must continue paying property taxes to keep the HECM in good standing. If you fall behind on property taxes, the loan can be declared due and payable. Some lenders will set up a tax set-aside account to ensure these bills are paid from your HECM proceeds.

How to apply in Texas

The Texas HECM application process follows the standard federal process, with the added 12-day waiting period after approval. Key steps:

1. Pre-qualification — Complete the free pre-qualification form to be matched with an FHA-approved lender in Texas. Start here →
2. HUD counseling — Required by federal law before submitting a formal application. Find a Texas HUD-approved counselor →
3. Application and appraisal — Your lender will guide you through the formal application, order an FHA-required appraisal, and calculate your official principal limit.
4. 12-day waiting period — After loan approval, Texas requires a 12-day wait before disbursement. Use this time to review your loan estimates and ask questions.
5. Closing and disbursement — At closing, you choose your disbursement structure and receive your funds.