Are you looking for a free and easy-to-use reverse mortgage payment calculator? Well, you’re in the right place! We believe we have one of the best reverse mortgage payment calculators available on the internet. And the best part is that it’s free and it doesn’t require you to submit any contact information.
If you’d like more information about how to use this reverse mortgage payment calculator, keep reading. We’ll walk you through the steps and offer some explanations that might be helpful. If you’d like skip the lessons and just go straight to the calculator, click the link below.
Note that the reverse mortgage offers several options for receiving proceeds. If you’re looking for monthly payment options, be sure to select either “Lifetime Payment”, “20-year Payment”, “15-year Payment”, or “10-year Payment” on Step 4.
How to Use the Reverse Mortgage Payment Calculator
Note that this calculator estimates proceeds for the federally-insured home equity conversion mortgage, or HECM. The HECM is the most common reverse mortgage program in the United States today. The following steps walk you through how to use our reverse mortgage calculator. Many of the pages offer explanations and definitions of terms as well as links to additional information.
Step 1: Age and Home Value
Your age and the estimated value of your home are important factors for determining how much you can get from a HECM. Enter the age of the youngest borrower and the estimated market value of your home (not the tax assessment value) and click “Next” to continue.
Step 2: Mortgage Balances and Payments
If you have one or more mortgages on the home, enter the total balances owed and the combined principal and interest payments (not including taxes and insurance). Also enter the number of years left on the loan, which will help make the amortization projections on Step 7 more meaningful. Click “Next” to continue.
Step 3: Select the State
Select the state in which you live and click “Next” to continue.
Step 4: Select How to Receive Proceeds
The calculator is programmed with several different options for receiving proceeds. Be sure to pick one of the last four options if you’re interested in monthly income payments:
- Lump Sum/LOC – You’ll receive the maximum proceeds available at closing as a lump sum (variable-rate HECM and fixed-rate HECM), then the remainder at one year in the form of a line of credit (variable-rate HECM only).
- LOC Only – You’ll receive all proceeds in the form of a line of credit (variable-rate HECM only).
- Lifetime Payment – You’ll receive all proceeds in the form of a lifetime, or tenure, payment to you (variable-rate HECM only).
- 20-Year Payment – You’ll receive all proceeds in the form of a 20-year term payment to you (variable-rate HECM only).
- 15-Year Payment – You’ll receive all proceeds in the form of a 15-year term payment to you (variable-rate HECM only).
- 10-Year Payment – You’ll receive all proceeds in the form of a 10-year term payment to you (variable-rate HECM only).
Click “Next” to continue.
Step 5: Confirm and Calculate
Confirm that all the information is correct, then click “Next” to continue.
Step 6: Calculation Results
The calculator will display the estimated interest rates, closing costs, and proceeds available. Note that the interest rates and closing costs displayed are only estimates; actual lender interest rates and closing costs will likely vary.
Note also that the fixed-rate HECM only offers proceeds in the form of a lump sum. You do not have the option to take proceeds as a monthly term, tenure, or line of credit with the fixed-rate HECM. Only the variable-rate HECM offers lump sum, line of credit, and term/tenure options.
Click “Next” to continue.
Step 7: Projected Amortization
The amortization schedule displays an analysis of how the loan balance and line of credit change over time. It also displays cumulative savings and/or added income realized through eliminated mortgage payments and added term or tenure payments.
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