See what your equity could free up.
A reverse mortgage turns part of the equity in your home into cash you do not repay monthly. This estimates how much, at your age.
Start with the home and the youngest borrower.
Age is what decides the share you can draw, so the youngest person on the title sets it. Everything moves as you type.
Your estimated loan coverage
- $334,500
- $665,500
Before closing costs and mortgage insurance, which come out of these proceeds. Your real figure lands lower.
- Covered by the loan $334,500
- Cash you bring $665,500
An estimate built from what you entered — not a quote or an approval.
Get this priced for youA starting assumption, not an offer. Your rate is priced to your file.
- About 2.25%
- 0.335
Where a lender starts on their half of the expected rate. The other half is an index that moves with the market.
Set by HUD from your age and the expected rate — not by this lender.
How the estimate was built.
The value the loan claims against, the factor your age earns against it, and what is left once any existing mortgage is paid off.
- What the home is worth
- $1,000,000
- What the loan can claim against
- $1,000,000
- Principal limit factor at this age
- 0.335
- Principal limit
- $334,500
What a reverse mortgage actually is.
The rules that decide whether one fits, and the two forms it takes — refinancing the home you own, or buying the next one.
How it works
A loan against your equity that you do not repay monthly.
- Reverse mortgages let older homeowners draw on the equity in the house they live in, while the title stays in their name.
- Nothing is due each month. The loan is repaid when the last borrower sells, moves out permanently, or passes away.
- Whatever is left once the loan is settled goes to you or to your heirs. The lender does not take the house.
Whether you qualify
Five requirements, and the age one has two answers.
- You must be 62 or older for a federally-insured loan. Proprietary loans can start at 55, and that varies by state and by product.
- You have to live in the home. A second home or a rental does not qualify, and neither does one you have moved out of.
- You need to own a large share of the home outright. Any mortgage still on it is paid off first, out of the proceeds.
- You keep paying property taxes, homeowners insurance and upkeep. Falling behind on those is what puts the loan at risk.
- A federally-insured loan requires a session with a counselling agency approved by HUD before the application goes anywhere.
Refinancing the home you own
The common one — turn equity into cash without moving.
- Converts part of the equity in your primary residence into cash, without selling the home and without a monthly mortgage payment.
- A lump sum, a line of credit, or a monthly payment to you. Instead of paying the lender, the lender pays you.
- You own and live in the home as before, and you remain responsible for the taxes, the insurance and the maintenance on it.
- Loan proceeds are generally not treated as income, but your situation is yours — ask a tax adviser before you count on it.
Buying your next home
One transaction: a down payment plus loan proceeds.
- Buys a new primary residence by combining a one-time down payment with reverse mortgage proceeds, all in a single transaction.
- People relocating or downsizing, who would rather put less of the sale price of the old house into the new one.
- No monthly mortgage payment while you live there, and the same duty to stay current on taxes, insurance and maintenance.
The factor is a table. The decision is not.
How long you stay, what you still owe, and what you want to leave behind all move the answer. A loan officer can price yours.
Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.