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Reverse Mortgage Calculator (HECM)
2025 HUD HECM limit: $1,209,750 · Estimate only
See your estimated reverse mortgage proceeds, fees, and potential monthly tenure payment. For homeowners 62 and older.
Your information
Will be paid off from the new loan.
Net cash available
$65,500
After paying off existing mortgage + fees
Principal limit
$131,500
26.3% of home value
Estimated upfront fees
$16,000
MIP: $10,000 + closing: $6,000
Monthly tenure payment
$182
If you take payments instead of lump sum
Analysis & insights
Based on a $500,000 home and a youngest-borrower age of 70, your net proceeds after fees + existing mortgage payoff: $65,500. Principal limit (max borrowable): $131,500 (PLF of 26.3%). Upfront fees: $16,000 ($10,000 MIP + $6,000 closing). Monthly tenure-payment option: $182/month for life. A reverse mortgage (HECM) lets you tap home equity without monthly payments — but you must keep paying property tax, insurance, and HOA, or you risk losing the home.
Low net proceeds vs home value
You'd access less than 20% of home value as cash. May not justify the loan setup costs.
Risk & benchmark gauge
Current band
Low
13.1% of home value as cash
Industry benchmarks
- Net cash to you$65,500
- Principal limit$131,500
- Principal limit factor26.3%
- Upfront fees$16,000
- Monthly tenure payment$182/mo
- 2025 HUD HECM limit$1,209,750
Key insights
You CAN lose the home
Failing to pay property tax, insurance, or HOA — even with no mortgage payment — triggers default. This is the #1 reason seniors lose homes with reverse mortgages.
Non-recourse — you can never owe more than home value
If the loan balance grows beyond home value at payoff time (sale, move, death), FHA insurance covers the gap. Your heirs aren't liable for the difference.
Upfront MIP is a permanent 2% drag
The 2% upfront mortgage insurance premium is mandatory and not refundable. On a $500K home, that's $10,000 of fees before you see any money.
Consider downsizing first
For many seniors, selling and buying a smaller home outright eliminates the loan AND captures the equity in cash. Often financially better than a reverse mortgage.
Recommended actions(4)
Complete HUD-mandatory counseling
High priorityRequired by HUD before closing — independent counselor (free or low-cost) reviews alternatives. Take it seriously. Counselors often steer applicants AWAY from HECMs.
Impact: The counselor's job is your interests, not the loan officer's. Listen.
Evaluate alternatives FIRST
High priorityHELOC (cheaper, but requires income), downsize + cash equity (often the best move), family loan (formalize with promissory note), sale-leaseback. All are worth comparing.
Confirm you can afford ongoing costs
High priorityEven with no mortgage payment, you still pay property tax + insurance + HOA + maintenance. If those exceed your monthly income, the HECM puts the home at risk.
Important caveats
- • You must continue to pay property tax, insurance, and HOA fees, or risk default.
- • The loan becomes due when you sell, move out, or pass away.
- • HUD requires counseling from a HUD-approved counselor before closing.
- • This is an estimate. Get a formal quote from a HECM lender for actual numbers.
Tap Your Home Equity
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This tool is for educational purposes only and does not constitute financial, tax, or investment advice. Consult a qualified financial professional for advice specific to your situation.
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