Reverse Mortgage Estimator

Reverse Mortgage (HECM) Estimator (USA Focus - Illustrative)

This tool provides VERY ROUGH ESTIMATES for educational purposes only. It is NOT a loan offer or financial advice. Actual HECM terms, proceeds, and costs vary significantly. You MUST consult an FHA-approved HECM counselor and multiple lenders.

Borrower & Property Information

Age of Youngest Borrower (Years):

Appraised Home Value ($):

Note: For HECM calculations, this value is capped at the FHA national lending limit (e.g., $1,149,825 for 2024 - check current limits).

Existing Mortgage Balance ($) (If any, to be paid off):

Interest Rate & Closing Cost Estimates

Estimated "Expected Average Mortgage Interest Rate" (%):

This single rate is used to estimate your Principal Limit Factor (PLF) and for illustrative loan balance growth. It should represent the HECM initial interest rate PLUS the ongoing annual MIP (0.5%). For example, if loan rate is 6% and annual MIP is 0.5%, enter around 6.5%. This is a critical estimate; actual rates vary by lender and market. Check with lenders for current expected rates used in PLF calculations.

Estimated Other Upfront Closing Costs ($) (Excludes Origination Fee & Upfront MIP):

Estimated HECM Proceeds & Illustrative Loan Growth

Please complete your inputs on the previous tabs and click "Estimate HECM Proceeds" to see the summary.

ULTRA-IMPORTANT DISCLAIMER:

This calculator provides **highly simplified and illustrative estimates ONLY.** It is NOT a substitute for official HECM calculations or professional advice.
**Principal Limit Factors (PLFs) are complex** and depend on precise age, the specific HECM expected rate (which has multiple components), and current FHA tables. This tool uses a very basic approximation for PLF and it WILL NOT match official lender calculations.
Actual loan amounts, interest rates, fees, and available proceeds can **vary significantly** based on the lender, chosen HECM product (e.g., fixed vs. adjustable rate), current market conditions, and your specific circumstances.
The loan balance on a reverse mortgage grows over time as interest, MIP, and servicing fees accrue. No monthly mortgage payments are required as long as you meet loan obligations (live in home, pay property taxes/insurance, maintain home). The loan becomes due when the last borrower permanently leaves the home or fails to meet obligations.
**YOU MUST SPEAK WITH AN FHA-APPROVED HECM COUNSELOR** before applying for a reverse mortgage. This is a mandatory step. They will provide unbiased information and explain how HECMs work.
Always obtain official loan illustrations from multiple HECM lenders.

This tool is for educational purposes to understand basic concepts and is **NOT financial or mortgage advice.**