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Selecting the Best Options on a HECM Reverse Mortgage(19a)

What a HECM Reverse Mortgage Is: A way for home owners of 62 or older to borrow against the equity in their homes, with no obligation to repay so long as they live in the home, with multiple options for drawing funds and with payments guaranteed by the Federal Housing Administration (FHA). For a fuller description, read Description of HECM Reverse Mortgage Program.

Who This Calculator Is For: Homeowners over 62 who want to extract cash from their home using a HECM but are not sure which HECM option they want to use.

What This Calculator Does: This calculator shows how the senior’s borrowing power can be used to draw cash at closing, to retain an unused credit line that will grow over time, to receive an annuity for as long as they live in the house, to receive an annuity for a specified period, or to combine several of these options. To see how the diverse needs of seniors are addressed by these different HECM options, read Can a HECM Reverse Mortgage Help ME?

Instructions
  • Enter the information requested.
  • Click on "View Calculators"
  • Scroll down to the first of the 10 options you want to look at and click on "Calculate Option". This will display the amounts you can draw, as well as the interest rate and fees on that option."
  • Repeat the process for any other options you may want to explore.
  • If you want to see how your debt and credit line may grow under the option, click on "View Future Debt and Credit Line".
  • Click on "Select" in the column headed "Select Best Lender" for the HECM option you want. You will be taken to a new page where you select the lender offering the best price on your option.

Step 1 Enter Information About You and Your House
Birth Date of Youngest Borrower:    (ex: 3/15/1940)
Property Value:    (ex: 300000)
Property Zip Code:    (ex: 90210)
Existing Mortgage Balance and Liens:    (ex: 120000)
Expected Years in House:
Step 2
Help
Need Help?
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Lenders
Need a Lender?
Click Here to Contact a Certified Reverse Mortgage Lender
View Lenders
Type of HECM: HECMs come in two flavors, standard and saver. The saver cuts the amount you can draw but also largely eliminates the upfront mortgage insurance premium paid to FHA. Read Choosing Between Standard and Saver HECMs.
Maximum Draw: The largest cash withdrawal, initial credit line or monthly payment allowed.
Initial Loan Amount: This is the amount you will owe when your HECM transaction closes.
Interest Rate: On ARMs, it is assumed that the initial rate continues through the life of the HECM. Interest rate on FRMs is constant throughout the life of the loan.
Interest Rate: On ARMs, it is assumed that the initial rate continues through the life of the HECM. The maximum interest on HECM ARMs is 10 percentage points higher than the initial rate.
Annual Mortgage Insurance Rate: The annual rate of 1.25% is applied to all HECMs and is calculated monthly based on the monthly loan balance.
Upfront Mortgage Insurance: The FHA’s upfront mortgage insurance premium, which is 2% of property value on a standard HECM, and 0.01% of property value on a saver HECM.
Lender Fee: The fee charged by the lender for originating your loan. The fee is limited by FHA to $2500 if property value is less than $125,000. Above $125,000 , the fee is capped at 2% of the property value up to $200,000 plus 1% of the value above $200,000, with a maximum of $6,000.
Other Fees: The sum of title insurance, appraisal, and other fees, which are the same as on a forward mortgage.
Monthly Payment for Years: The fixed monthly payment you will receive for years.
Monthly Payment for Years: The fixed monthly payment you will receive for years..
Debt in Years: How much you will owe after years, but if interest rates rise you will owe more for ARM HECMs.
Credit Line in Years: How much you will be able to draw after years, but if interest rates rise you will be able to draw more on ARM HECMs.
Debt in Years: How much you will owe after years, but if interest rates rise you will owe more for ARM HECMs.
Credit Line in Years: How much you will be able to draw after years, but if interest rates rise you will be able to draw more on ARM HECMs.
Initial Credit Line: The amount you will be able to draw immediately.
Monthly Tenure Payment: The fixed monthly payment you will receive while you live in the house.
Privacy Policy: Your phone number and email address will only be used to answer your question(s). You will not receive calls or emails from other parties and your personal information will not be sold or given to any other parties.