Reverse Mortgage (HECM) Guide for Illinois Homeowners 62+
Illinois has approximately 740,000 homeowner households led by someone 62 or older. With a median home value of $239,000, Illinois offers homeowners relatively affordable equity relative to national averages — though Chicago-area homes often trade well above that median. For Illinois seniors managing fixed-income retirement in a state with moderate costs, a HECM can provide meaningful supplemental cash flow.
Source: U.S. Census Bureau ACS 2022 1-Year Estimates (Table B25077); U.S. Census Bureau ACS 2022 1-Year Estimates (Table B25007)
$1,249,125
Illinois's median home values fall significantly below the 2026 FHA HECM limit of $1,249,125, so the vast majority of Illinois homeowners can access the full available equity on their home through a HECM. Higher-priced North Shore and Lincoln Park properties are exceptions, but most exceed the cap only rarely.
Source: HUD Mortgagee Letter 2025-21
Illinois Reverse Mortgage Protections
Illinois does not require additional reverse mortgage counseling beyond the federal HUD mandate. The Illinois Residential Mortgage License Act (205 ILCS 635) governs mortgage lenders in the state. Illinois seniors also benefit from the Senior Citizens Real Estate Tax Deferral Program, which can delay property tax payments — a useful tool for HECM borrowers managing cash flow.
Source: 205 ILCS 635; 35 ILCS 200/Art. 18; Illinois Department of Revenue
HUD-Approved Counseling in Illinois
Federal law requires an independent counseling session before any HECM application. Counseling can be done by phone and typically takes 60–90 minutes. Find a HUD-approved counselor in Illinois →
Illinois HECM FAQ
Are HECMs available in Illinois?
Yes. HECMs are available statewide in Illinois, including Chicago, suburban Cook County, and downstate communities. Any FHA-approved lender licensed in Illinois can originate a HECM.
Does Illinois require additional reverse mortgage counseling?
No state-specific counseling requirement exists beyond the federal HUD mandate. All HECM applicants must complete a HUD-approved counseling session before any application. Illinois has multiple HUD-approved agencies, particularly in the Chicago metropolitan area.
How do Illinois property taxes interact with a HECM?
Illinois has relatively high property taxes, and HECM borrowers must keep them current. Illinois offers a Senior Citizens Homestead Exemption that reduces assessed value by $8,000 for qualifying homeowners. The Senior Citizens Assessment Freeze Homestead Exemption prevents assessment increases for qualifying seniors with income below $65,000. These programs can reduce the tax burden for HECM holders.
What if I have a HELOC on my Illinois home?
An existing HELOC must be paid off and the line terminated at HECM closing. The payoff comes from HECM proceeds. Illinois lenders will verify there are no subordinate liens remaining after closing.
Where can I find a HUD-approved HECM counselor in Illinois?
Use the HUD HECM Counselor Search (link above) filtered to Illinois. Illinois has a strong network of HUD-approved agencies, including several in Chicago. Phone counseling is available statewide.