A recent client from Fairfax who requested a consultation mentioned that the monthly property tax bills are burdensome. They noted that their income has decreased after retirement, while rising home values have increased their tax burden. They inquired whether a reverse mortgage could alleviate this burden, and I explained that it is not a product that exempts them from taxes. However, it can help create cash flow without monthly repayment obligations, allowing them to cover their tax payments. I also pointed out that property taxes are a fixed cost that comes every year, and the burden is felt more acutely by households with reduced income.

A reverse mortgage is a product for homeowners aged 62 and older that allows them to borrow against the equity in their home. Unlike a traditional mortgage, the lender provides funds to the homeowner in the form of a lump sum, monthly payments, or a line of credit, and the loan is repaid when the home is sold, the owner passes away, or the home is no longer used as their primary residence. The HECM (Home Equity Conversion Mortgage), which is insured by the FHA, is the only type guaranteed by the federal government and is the most representative.

As of July 2026, the median home sale price in Fairfax City is approximately $749,950 (according to Houzeo). While this figure has adjusted slightly compared to the previous year, households that have lived there for a long time have likely built up significant equity. The issue lies with property taxes. The effective tax rate for Fairfax County for the 2026 fiscal year is $1.1225 per $100, meaning that for a home valued at around $740,000, the annual tax is substantial (according to County Tax Tools). As home values increase, the available equity also grows, but the amount of taxes owed each year also rises, which must be factored in.

To summarize the eligibility requirements, they are as follows:

• Must be 62 years or older
• The home must be the primary residence
• If there is an existing mortgage, it must be at a level that can be paid off with a reverse mortgage
• Must pass a financial assessment to confirm the ability to continue paying taxes and insurance

The advantages are clear. Since there is no need to repay principal and interest monthly, it can create cash flow for living expenses, taxes, and medical costs. It is a non-recourse structure, meaning that if the home value falls below the loan balance later, heirs are not required to pay the difference.

There is no set method for receiving funds. Homeowners can choose to receive a fixed amount monthly, receive funds for a specified period, use a line of credit as needed within a limit, or combine these methods. The best option depends on their spending patterns, so it is advisable to obtain estimates from multiple lenders before applying to compare fees and terms.

Conversely, there are also disadvantages to consider. The origination fee and mortgage insurance premium (initially about 2 percent, then around 0.5 percent annually), combined with closing costs, result in higher initial costs compared to a traditional mortgage. Over time, the loan balance increases while equity decreases, potentially reducing the assets left for children. Throughout the loan period, the responsibility for property taxes, insurance, and home maintenance remains with the owner. Failing to meet these obligations can lead to default, which could result in losing the home, meaning that attempting to reduce the tax burden could lead to an even greater burden.

As of 2024, the percentage of the population aged 65 and older in Virginia is 17.6 percent (according to America's Health Rankings), suggesting that more households will face similar concerns in the future. Reverse mortgages, including HECM, require mandatory counseling from a HUD-approved counseling agency before applying, where they can assess whether the product fits their situation. Be particularly cautious of offers that impersonate government agencies or pressure you to sign today for special conditions, as these are likely scams. It is safest to make decisions after thorough consultation and discussions with family. This article does not constitute investment or legal advice, and it is recommended to consult with a professional before applying.