HECM Reverse Mortgage Calculator

Enter the age of the youngest borrower (62 or older is required for a HECM) and the home's current appraised value. If you have an existing mortgage, enter its balance. It must be paid off from the reverse mortgage proceeds at closing. Add the expected interest rate and any upfront fees your lender quotes beyond the standard 2% FHA mortgage insurance premium, which the calculator adds automatically.

The result shows an estimated Principal Limit Factor, the maximum gross Principal Limit, the initial net amount available as cash or a line of credit after paying off debt and fees, and an estimated monthly tenure payment if you choose monthly income instead of a lump sum. Use it to compare scenarios, then get the lender's figures, which come from HUD's actual table.

A 72-year-old borrower owns a home appraised at $400,000 with a $50,000 mortgage balance remaining, and current HECM rates are 6.0%. The home is worth less than the 2026 HECM limit, so the full value counts. The factor below is this calculator's approximation, not a figure from HUD's table.

PLF = 0.30 + (72 - 62) × 0.012 - (6.0 - 5.0) × 0.04 = 0.38

Maximum Principal Limit = $400,000 × 0.38 = $152,000

From that $152,000, the calculator deducts the 2% upfront MIP ($8,000), the $50,000 existing mortgage payoff, and $4,000 in additional upfront fees, leaving an initial net principal limit of $90,000. HUD sizes a tenure payment as if the youngest borrower lives to 100, at the expected rate plus the 0.5% annual mortgage insurance premium, so for a 72-year-old at 6% it is an annuity over 28 years at 6.5%: roughly $582/month as an estimated tenure payment. Taken as a lump sum, HECM rules limit how much can be drawn in the first year; the calculator shows 60% of the net amount, about $54,000, as a planning estimate, and a lender will confirm the actual first-year limit.

A reverse mortgage is one of several ways retirees tap home equity. Compare it against a HELOC if you're open to a conventional line of credit, or run the numbers on a standard Mortgage Calculator and Refinance Calculator to see what a traditional loan would cost by comparison.