Reverse Mortgage Calculator

The Reverse Mortgage Calculator is a system designed by the Federal Housing Administration that determines a senior homeowner’s eligibility for a reverse mortgage loan. The proceeds available to you are based on the youngest borrower and your homes property value. Unlike general calculators found elsewhere, we regularly update and include current programs and rates offered at All Reverse Mortgage Company.

Get accurate proceeds across the best available programs...

> Click Here and receive a detailed comparison

What's included...

Calculator results page: Compare all (4) of the industries leading programs.

Amortization schedule with year by year interest accrual

Good Faith Estimate that Includes all financed insurances and loan fees

There is absolutely no-obligation to receive your personal analysis and will be sent to you by email same business day.

Reverse Mortgage Calculator - Results Explained:

Program Choices: You may choose either Fixed Rate or Adjustable Rate options. Visit Current Interest Rates for more information.

Available Loan: This is the principle limit available to you based on your age, HUD lending limit, and current rates. We calculate your NET amount after all financed insurance and lender fees.

Mortgages or Liens: This amount will be used to payoff any exciting home loans or secured liens on the property. (1st TD, 2nd TD)

Up front Lump Sum: Any amount of money you would like to take as cash at closing. (Cash Advance)

Line of Credit: You may take your available funds as a line of credit that grows with your age (The growth is calculated based on your interest rate + .50% monthly insurance). This is not to be construed with “earning interest” but rather gaining in time further borrowing ability. You will only be charged interest on money you borrow. Unlike a traditional line of credit (one you would expect to get from your bank) the Reverse Mortgage line of credit option is federally insured and is guaranteed to always be made available to you.

Monthly Income: Called the Tenure Payout (payments for life) You may choose to receive your money as monthly installments for LIFE, tax-free and guaranteed as long as you live in your home. This income may be sent via check or direct deposit and is guaranteed to never stop regardless what happens to your home’s value or however long you stay in your home.

Combination: You may choose to receive your proceeds in a combination of all. (examples: 50% Line of Credit, 50% Payments, 25% Cash Advance, 75% Line of Credit)

Fixed Rate: The Fixed Rate reverse mortgage is currently providing the highest principle limit and requires that you take all cash available at the close of escrow. If you do not have an immediate plan for these funds it is not always recommended as interest will grow at an accelerated rate -vs- taking your funds in the available line of credit or monthly payment option.

Why amounts vary from other lenders: Have you heard that all reverse mortgages are the same? This is untrue as different lenders offer different rates and margins. The lender has the ability negotiate / set it's own fees, margins, and programs so it's wise to compare your options.

Fees: The reverse mortgage calculator provides estimates after all financed fees and insurances. The figures you will see are NET proceeds made available. HECM loans are front loaded and not recommended for a short term solution. The fees may seem steep largely because they are federally insured which require an extra 2% of the lending limit to be paid to HUD to insure the program. You can complete our online request and receive a good faith estimate which includes a breakdown of all financed fees.

Will the proceeds affect Social Security or Medicare: Proceeds will not affect public benefits such as SS or Medicare but can affect "need based" programs such as Medicaid / Medical. It is advised that you consult with your trusted financial planner.

Will I pay Taxes on these proceeds: Funds received from your loan are generally considered to be *nontaxable as the money received is not income earned. You should always consult your trusted tax advisor.

Recommendations: It is not advised that you purchase annuities or other related financial products with your proceeds. If you would like a monthly payment stream you can receive this from the program which interest is only accrued as you receive the monthly payments rather than accruing interest from day 1 as a lump sum advance.

Reverse Mortgage Calculator: "the math"

Age is factored into the equation through life expectancy tables. Meaning the older the borrower is, the more money they are going to qualify for starting from the youngest age eligible of 62 going all the way up to a 100 year cap for the table.  In the case where a borrower is over the age of 100, they would qualify for the same amount as a 100 year old because that is where the tables stop.  Next the interest rate is taken into consideration.  There are two interest rates disclosed for all Reverse Mortgage Loans.  The interest rate that is factored into the equation is known as the “expected rate”.  This rate consists of the 10 year index (which is variable) plus the borrower’s margin. 

The Higher the rates are at the time the calculator is ran, the lower the overall total amount to a borrower will be.  There is however a floor rate of 5.5%.  Any interest rate below 5.5% will no longer increase the amount of proceeds available through the Reverse Mortgage.  Lastly, the borrower’s home value or government lending limit is factored into the equation.  Based on a borrower’s age and the interest rate available they will be eligible to receive a percentage of this final value.  This value can range from somewhere around 50% (62 year old) to sometimes as high as 80% (100 year old).

One other function is to calculate the Mortgage Insurance Premium, Loan Origination and miscellaneous third party closing costs that are financed through the Reverse Mortgage Transaction.  The Calculator is able to figure these numbers very easily because the Reverse Mortgage program is government insured and regulated and there are set fees on these loans.

*Reverse Mortgage Calculator results are for illustration purpose only and are not an offer to lend. If you wish to receive a formal quote with an estimate of all loan charges, as well as an amortization schedule that will show interest accrued year by year please contact one of our reverse mortgage specialists. *Tax-Free: Always consult your trusted tax-professional

*Reverse Mortgage Calculator powered by Reverse Vision