Reverse Mortgages in Maryland

Last reviewed 2026-06-01

In Maryland, a homeowner 62 or older can convert part of their home equity to cash through a federally insured HECM reverse mortgage. Here is how the math works, what Maryland layers on top of the federal rules, and where to find a counselor.

Maryland applies the federal HECM program without enacting a separate state reverse-mortgage statute, but it carries one of the heaviest recording-tax burdens of any state — the main reason its standard-HECM suitability sits in the "constrained" band. What changes here is the licensing agency for the originator, the combined recordation and transfer taxes, and the metro distribution of HUD-approved counselors. About 16.3% of Maryland residents are 65 or older (U.S. Census Bureau, American Community Survey 5-year estimates 2018–2022), concentrated in the Baltimore and Washington, D.C. suburbs and the Eastern Shore retirement communities.

The 2026 federal HECM lending limit of $1,249,125 applies in Maryland (HUD Mortgagee Letter 2025-22). For the structural basics of the product, see what a reverse mortgage is and how it works.

What reverse mortgage rules are specific to Maryland?

No state-specific counseling overlay. Maryland applies the federal HUD-approved counseling requirement (HUD Handbook 4000.1, Section II.B) and adds no separate state session. Phone counseling is permitted; the certificate is valid for 180 days from the session date.

Lender and originator oversight. Mortgage loan originators and lenders operating in Maryland are licensed and supervised by the Maryland Office of Financial Regulation, within the Department of Labor. The Office administers the Maryland Mortgage Lender Law (Md. Code, Financial Institutions Article, Title 11, Subtitle 5), which sets licensing, disclosure, and conduct standards for originators. Originator licenses are verifiable through NMLS Consumer Access.

Recordation and transfer taxes are high. Maryland imposes a state recordation tax assessed per $500 of the consideration or principal secured, plus a state transfer tax and, in most jurisdictions, a county transfer tax (Md. Code, Tax-Property Article, Titles 12 and 13). Combined, these run materially higher than the national norm — on the order of 0.7% or more of the secured amount on a typical HECM in many counties, on the order of $2,800 or more on a $400,000 principal limit, rolled into closing costs. Maryland law provides a recordation-tax treatment that limits the tax on the line-of-credit portion in some refinance and HECM contexts; the lender's settlement agent computes the exact figure per county and per loan structure.

No homestead obstacle to the HECM lien. Maryland's homestead exemption shields a capped dollar amount of equity from general creditors but does not block a HECM lien, because the borrower consents to the security instrument at closing.

Surviving non-borrowing spouse. Maryland applies the federal HUD ML 2015-15 deferral framework through the loan note. There is no separate state statute layered above the federal rule.

How much can you borrow with a reverse mortgage in Maryland?

Maryland home values are higher than most states in this rollout, but still below the $1,249,125 federal HECM cap across the bulk of the state, so the cap is non-binding outside the high-value submarkets around Bethesda, Potomac, Chevy Chase, and select Eastern Shore waterfront. The state median owner-occupied home value is about $397,700 (U.S. Census Bureau, ACS 5-year, table B25077). For a typical 70-year-old Maryland borrower with a paid-off home appraised near that median, the principal-limit factor at current HECM rates returns roughly 47–54% of value before closing costs — a planning range in the mid-$180,000s to mid-$210,000s (an estimate, not a quote). Maryland's higher recording-tax burden consumes more of that draw at closing than in low-tax states, which is reflected in the state suitability score.

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For how Maryland ranks against the other 50 jurisdictions on standard-HECM fit, see the Maryland suitability score — a computed 0–100 comparison built from senior population share, median home value against the cap, recording-cost burden, and counselor access. Maryland's recording-tax burden is the input that pulls its score into the lower band.

Do you need counseling for a reverse mortgage in Maryland?

Every Maryland HECM borrower completes a HUD-approved counseling session before the lender may accept the application. Sessions run 60–90 minutes and cost roughly $125–$200, with fee waivers available for borrowers whose household income falls below the threshold the agency publishes. Phone sessions are the default; in-person sessions are available in the larger metros. Maryland's counselor density per senior is comparatively strong.

Find a Maryland-authorized counselor on the HUD HECM Counselor Roster or call 1-800-569-4287. The Baltimore and Washington-suburb metros generally schedule within 1–2 weeks; the Eastern Shore counties can run longer.

Will my heirs be on the hook?

A HECM is non-recourse: your heirs and your estate will never owe more than the home is worth at the time of sale, even if the loan balance has grown past the home's value (12 USC §1715z-20). For the heir-side timeline and the four disposition options, see reverse mortgage due and payable.

What does the borrower still have to pay?

The FHA-insured HECM is a loan, not a government benefit. It removes the monthly principal-and-interest payment but does not remove the borrower's other obligations. Throughout the life of a Maryland HECM the borrower must:

• Keep property taxes current. Maryland counties and Baltimore City bill property tax annually; non-payment is a default event under the HECM note and can trigger a property-charge foreclosure.
• Maintain homeowners insurance. Standard hazard coverage, plus flood insurance where applicable for properties in FEMA Special Flood Hazard Areas along the Chesapeake Bay, the Eastern Shore, and the Potomac corridor.
• Occupy the home as a primary residence. Moving out for more than 12 consecutive months, including a permanent move into assisted living, triggers the loan's due-and-payable clause.
• Keep the home in reasonable repair. Significant deferred maintenance can constitute a property-charge default under the HECM contract.

These obligations are federal and apply identically in every state. Maryland adds nothing to them and removes nothing from them.

What about jumbo in Maryland?

Maryland is not broadly a jumbo-driven state, though its higher median home value puts more homes near the cap than the low-cost states in this rollout. The high-value submarkets around Bethesda, Potomac, and select Eastern Shore waterfront carry values above the $1,249,125 federal HECM cap; for those, jumbo / proprietary programs (HomeSafe, Platinum Preserve, SecureEquity+) admit at age 55 and extend the cap up to $4M loan value, trading FHA statutory non-recourse and MIP for contractual terms and a higher lender margin. For most of Maryland the standard HECM is still the path. See the HECM vs. jumbo comparison.

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