Reverse Mortgage Calculator
Estimate how much you might be able to draw from a Home Equity Conversion Mortgage (HECM) based on the age of the youngest borrower, your home value, your existing mortgage balance and an expected interest rate. These figures are rough estimates only — a HUD-approved counselor and a licensed lender give you real numbers.
Disclaimer: This calculator provides estimates for general informational and educational purposes only. It is not financial, lending, tax or legal advice, and it does not guarantee any loan terms, rate, payment or approval. Actual figures depend on your lender, credit, location and the final terms of any loan. Always confirm numbers with a HUD-approved reverse-mortgage counselor and a licensed lender before making a decision.
What a reverse mortgage is
A reverse mortgage is a special type of home loan for homeowners aged 62 or older that lets you convert part of the equity in your home into cash — as a lump sum, monthly advances, a line of credit, or a combination — without having to make a monthly mortgage payment. The most common version is the Home Equity Conversion Mortgage (HECM), which is insured by the Federal Housing Administration (FHA) and regulated by the U.S. Department of Housing and Urban Development (HUD).
The key thing to understand is that a reverse mortgage works in the opposite direction to a normal mortgage. Because you make no required monthly payment, the loan balance grows over time as interest, mortgage insurance and servicing fees are added to it. The loan does not have to be repaid until a maturity event — when the last borrower sells the home, permanently moves out, or passes away. At that point the loan is repaid, usually from the sale of the home, and any remaining equity belongs to you or your heirs.
You also keep important responsibilities. You must continue to pay your property taxes, homeowners insurance and keep the home in good repair, and the home must remain your primary residence. If you fall behind on those obligations, the loan can go into default and you could lose the home to foreclosure — even though you owe no monthly mortgage payment.
How the proceeds are estimated
The amount you can receive starts from a figure called the Principal Limit. It is calculated from your eligible home value — capped at the HUD lending limit ($1,209,750 in 2025) — multiplied by a Principal Limit Factor (PLF):
Principal Limit = min(home value, HUD limit) × PLF
The PLF is a percentage published by HUD that rises with the age of the youngest borrower and falls as the expected interest rate rises. Older borrowers and lower rates produce a larger principal limit. Before you receive anything, any existing mortgage must be paid off first from the proceeds, and lender fees and the initial mortgage-insurance premium are deducted as well. What is left is what you can actually draw.
A worked example
Using the calculator's defaults — a youngest borrower aged 70, a $500,000 home and a $50,000 existing mortgage at an expected rate around 6.5%:
- At age 70 the approximate PLF is about 0.48.
- $500,000 × 0.48 = $240,000 principal limit.
- Subtract the $50,000 existing mortgage that must be paid off first.
- That leaves roughly $190,000 potentially available — before closing costs, the initial mortgage-insurance premium and other fees, which reduce it further.
Remember this is a simplified estimate. The real HECM PLF depends on the exact age of the youngest borrower and the precise expected rate from HUD's current tables, so your true number will differ.
What affects your proceeds
- Age of the youngest borrower. Older borrowers qualify for a higher Principal Limit Factor, so they can typically access more of their equity.
- Home value. A higher appraised value increases your principal limit — but only up to the HUD lending limit. Value above that cap does not count.
- Expected interest rate. A higher expected rate lowers the PLF and therefore lowers your proceeds; a lower expected rate raises them.
- Existing mortgage balance. Any current mortgage or lien must be paid off from the reverse-mortgage proceeds first, which reduces the cash left over for you.
Reverse mortgages are complex and costly — proceed carefully. The loan balance grows over time instead of shrinking, which steadily reduces the equity and inheritance you leave behind. Up-front and ongoing costs (origination fees, mortgage insurance and servicing) are significant. And you can still lose your home if you fail to pay property taxes, homeowners insurance or keep up maintenance, or if you no longer live there. HUD-approved counseling is mandatory. Before committing, talk to a HUD-approved counselor and a licensed reverse-mortgage lender so you fully understand the costs, risks and alternatives.
Frequently asked questions
Who qualifies for a reverse mortgage?
For a HECM — the most common, federally insured reverse mortgage — the youngest borrower (or eligible non-borrowing spouse) generally must be at least 62 years old. You must own the home and live in it as your primary residence, have significant equity, and be able to keep up property taxes, homeowners insurance and upkeep. You must also complete HUD-approved counseling before applying.
Do I have to make monthly mortgage payments?
No. With a reverse mortgage you are not required to make monthly principal-and-interest payments. Instead the loan balance grows over time as interest and fees are added, and it is repaid later when you sell the home, move out, or pass away. You must still pay your property taxes, homeowners insurance and maintenance — falling behind on those can put the loan into default and you could lose the home.
How is the amount I can borrow determined?
Your proceeds start from a Principal Limit, which is your eligible home value (capped at the HUD lending limit) multiplied by a Principal Limit Factor (PLF). The PLF rises with the age of the youngest borrower and falls as the expected interest rate rises. Any existing mortgage must be paid off from the proceeds first, and lender fees and the initial mortgage-insurance premium reduce what is left. HUD publishes the official PLF tables; this tool only approximates them.
Will my heirs owe money after I die?
A HECM is a non-recourse loan. That means neither you nor your heirs ever owe more than the home is worth when the loan is repaid. The loan is generally settled from the sale of the home; if the home sells for more than the balance, the remaining equity goes to you or your heirs, and if it sells for less, FHA insurance covers the shortfall. Your heirs can also choose to keep the home by paying off the balance (or 95% of the appraised value, whichever is less).
Is counseling required before getting a reverse mortgage?
Yes. For a HECM you are required to complete counseling with an independent, HUD-approved counselor before your loan can move forward. The counselor explains the costs, the alternatives and the obligations so you can decide whether a reverse mortgage is right for you. Treat this as a protection, not a formality.
Can I lose my home with a reverse mortgage?
Yes. Even though you make no monthly mortgage payments, you must keep the home as your primary residence and stay current on property taxes, homeowners insurance and required maintenance. If you fail to meet these obligations, or move out for more than 12 months, the loan can become due and you could face foreclosure. This is one of the most important risks to weigh.
Related tools
If you want to keep ownership and equity intact, compare a reverse mortgage with a home equity loan or a HELOC, which let you borrow against equity while still making monthly payments. You can also explore a cash-out refinance to tap equity through a new first mortgage, or use the refinance calculator to see whether a standard refinance lowers your payment instead.