Reverse Mortgage Calculator: HECM Payout & Costs
Our Reverse Mortgage Calculator estimates HECM payouts: lump sum, monthly income, or line of credit. See eligibility, fees, and equity impact.
What is a Reverse Mortgage?
A loan for homeowners 62+ that converts home equity into cash. No monthly payments — balance grows over time, repaid when home is sold.
Eligibility
- Age 62+
- Own home outright or low mortgage
- Primary residence
- Financial assessment
- Counseling required
Payout Options
- Lump Sum: Max at closing
- Monthly: Fixed income for life or term
- Line of Credit: Draw as needed
- Combo: Monthly + credit line
Principal Limit Factors
- Youngest borrower age
- Home value (FHA max $1,149,825 in 2025)
- Interest rate
- Upfront costs
Costs & Fees
| Fee | Amount |
|---|---|
| MIP (Initial) | 2% of home value |
| MIP (Annual) | 0.5% of balance |
| Origination | $2,500–$6,000 |
| Closing Costs | $2,000–$5,000 |
Example: $500K Home, Age 70, 6.5%
- Lump Sum: ~$285,000
- Monthly (Life): ~$1,600
- Line of Credit: ~$290,000
- Net after fees: ~$270,000
Risks
- Reduces inheritance
- Balance grows over time
- Must maintain home & taxes
- Non-borrower spouse protection
Alternatives
- Downsize
- Home Equity Loan
- Cash-out Refinance
- Government assistance
Pro Tips
- Get HUD counseling
- Compare multiple lenders
- Preserve line of credit growth
- Plan for long-term care
Conclusion
Reverse mortgages offer flexibility for seniors. Use our Reverse Mortgage Calculator to plan wisely. Explore more in Finance Calculators.