Reverse Mortgage
Calculate Reverse Mortgage instantly with the exact formula and a worked example.
Reverse Mortgage
Home value$
Share of value available (by age and rate)%
Age of the youngest borroweryears
Interest rate% per year
One-time closing costs$
Lifetime monthly payment
34,987$
Available amount
4800000$
Payout term (to age 100)
360months
Received over 10 years
4198494$
More about: Reverse Mortgage
What it calculates
The “Reverse Mortgage” calculator computes Lifetime monthly payment in $ from 5 parameters: home value ($), share of value available (by age and rate) (%), age of the youngest borrower (years), rate (% per year), one-time closing costs ($).
Useful when choosing a loan, working out the payment, estimating the total cost, and comparing options.
Example calculation
With parameters Home value = 10,000,000 $, Share of value available (by age and rate) = 50 %, Age of the youngest borrower = 70 years, Rate = 8 % per year, One-time closing costs = 200,000 $ the result is 34,987 $ (The debt grows with interest and is repaid by selling the home).
How to use
- Enter home value, share of value available (by age and rate), age of the youngest borrower, rate and one-time closing costs — each field above is adjustable with a slider.
- Lifetime monthly payment ($) is calculated automatically as you type.
- Check the worked example below to see the formula applied to real numbers.
- Copy the result or bookmark this calculator.
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FAQ
How is the monthly loan payment calculated?
With the amortization formula: P = S · (i · (1+i)^n) / ((1+i)^n − 1), where S is the loan amount, i is the monthly interest rate (annual rate / 12 / 100), and n is the number of months. This produces equal monthly payments over the full term.
What is APR and how does it differ from the interest rate?
APR (Annual Percentage Rate) reflects the total yearly cost of the loan including the interest rate plus most fees (origination, processing). It is usually higher than the nominal interest rate and is the most reliable number for comparing loan offers.
Can I pay off a loan early without penalty?
Most consumer loans in the US allow early payoff. A few lenders charge a prepayment penalty, so check your loan agreement. Paying extra toward principal reduces the total interest you pay over the life of the loan.
What affects the total interest I pay?
The loan amount, the interest rate, and the term. A longer term lowers the monthly payment but increases total interest. A shorter term costs more per month but far less overall.
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