Stay in the home you love
and put its equity to work, without a monthly mortgage payment
If you're 62 or older, a HECM reverse mortgage can pay off your existing mortgage and free up what's left as cash, a line of credit, or monthly income — with no monthly mortgage payment required. Payment of property taxes, insurance, HOA dues, and maintenance are still required. Primary residence only.
Your equity, without the monthly payment.
Take it as cash, as a line of credit, or as monthly income. And whatever you leave in a line of credit keeps growing at whatever your annual interest rate is, plus 0.50%, for as long as you live in the home.
Calculate your numbers
Everything owed against the home, including any second mortgage or HELOC. Enter $0 if the home is owned free and clear.
Use your age within 6 months of closing.
They'd be an eligible non-borrowing spouse — protected from having to leave the home, but the loan is sized on their younger age, which lowers the amount considerably.
Loan assumptions
6.000% · 41.6%The “expected” interest rate is used to determine how much HUD allows you to borrow. It's based on the average 10-Year CMT index last week plus the lender's margin, and it can change from week to week — call or text Chad Peck for this week's figure.
Your actual interest rate is what you're charged on your balance, based on the 1-Year CMT index plus the lender's margin. Your unused line of credit grows at this rate plus 0.50%. Your actual rate can adjust monthly as the 1-Year CMT index moves, with an interest rate cap of 5% above where your rate started at closing — often referred to as a Cap5. Be sure to call or text Chad Peck to confirm this week’s current interest rate.
A LESA reserves part of the loan to pay your property taxes and homeowners insurance, which reduces the proceeds available to you. Ask Chad for your figure and enter it here.
The whole picture
Where every dollar of your home value sits.
A reverse mortgage never lends against all of your value. The largest slice below is usually the part that simply stays as equity \u2014 still yours, still in the home, just not available to borrow against.
Home value$0
- Available to you
- $0
- Mortgage payoff
- $0
- FHA mortgage insurance
- $0
- Origination and third-party fees
- $0
- Equity reserve
- $0
Equity reserve is the share of your home’s value the loan doesn’t lend against. It stays yours — it goes to you when you sell, or to your heirs.
How you take the money
Four ways to receive your proceeds.
The figure above is what's available. How you actually take it is a separate decision, and it's the part worth thinking hardest about — the right structure depends on whether you need cash now, income later, or a reserve you may never touch.
Lump sum
A single draw at closing. This is the only option on a fixed-rate HECM. Straightforward, but the full balance starts accruing interest immediately — and HUD’s first-year limit usually means you cannot take everything at closing.
Suits a large one-time need — paying off a mortgage, clearing debt, a major repair.
Line of credit
Draw what you want, when you want it. You only pay interest on what you've actually taken, and the unused portion grows every month at your rate plus 0.50%.
Suits a reserve for the unexpected, or anyone who wants the option without the obligation.
Tenure payments
Equal monthly payments to you for as long as you live in the home as your principal residence — however long that turns out to be. The payments don't stop if the balance passes the home's value.
Suits topping up monthly income for the long haul.
Term payments
Equal monthly payments for a set number of years that you choose. Because the money is spread over a shorter period, each payment is larger than tenure — but it stops when the term ends.
Suits bridging a defined gap, like the years before Social Security or a pension starts.
You can combine them. Most borrowers do — some cash at closing, a line of credit for reserves, and monthly payments alongside. Call or text Chad and he'll quote the actual monthly figures for tenure and term against your numbers.
The part people miss
An unused line of credit keeps growing.
If you take your proceeds as a line of credit and leave some of it alone, the unused portion grows every month at your interest rate plus the 0.50% FHA insurance premium. Not a projection of your home's value — this is the borrowing power itself increasing.
- In 5 years
- $0
- In 10 years
- $0
- At age 100
- $0
Line of credit would be
$0
Growth over that time $0
See your loan balance, credit line, home value and remaining equity side by side for every year — with or without voluntary payments.
Why homeowners do this
What this makes possible.
Free up monthly cash flow
Paying off an existing mortgage removes that payment from your budget. For many borrowers that alone is the reason — money that stays available for living rather than servicing a loan.
A reserve that grows
Set the proceeds up as a line of credit and the unused portion increases every month. Available when you need it, growing while you don't.
Stay in the home
No move, no downsizing, no disruption. You keep title and you keep living where you are, for as long as it remains your principal residence.
Myth vs fact
The most common misconceptions of a reverse mortgage.
Bank gets the house
You retain title to the property, the same as with any other mortgage.
Disinherit the kids
Your beneficiaries can inherit the home, with all of the remaining equity.
You may have to move
The loan is not due when the money is used up.
Owe more than the home is worth
Loans are non-recourse and insured, and cannot attach to your other assets.
You can't make payments
Payments are flexible, not forbidden. They just aren't required.
Things to remember and consider
- Property taxes and homeowners insuranceFalling behind can put the loan into default and lead to foreclosure.
- HOA dues and upkeepThe home has to stay in good repair and meet FHA property standards.
- OccupancyThe home must be your principal residence. Each year, on the anniversary month of your closing, you must certify to the lender that at least one borrower still occupies the home.
- TitleYou own the home, not the lender. You can sell it at any time without penalty or approval, just like any other mortgage. You can even hold title in your revocable living trust.
- A balance that growsAssuming you don't make monthly payments, interest and FHA mortgage insurance accrue on what you borrow, so the equity left to your heirs usually gets smaller over time — depending on what happens to your home's value. If the future is like the past, your home's value should continue to appreciate as well.
Start to finish
Six steps to complete your reverse mortgage.
- 1EducationMeet with Chad Peck, your Reverse Mortgage licensed loan officer, and gather what you need to decide whether a reverse mortgage is right for you.
- 2Independent HUD counselingHUD requires a session with an approved counselor before anything moves forward. It's separate from us.
- 3ApplicationComplete your application and provide the documentation needed for approval. This is where your expected rate gets locked for a period of time to secure your calculations.
- 4AppraisalWe order the appraisal on your behalf to determine the home's value. A second appraisal may be required upon review.
- 5Processing and underwritingWith the appraisal, title, and your documentation in hand, your file goes to underwriting for formal approval.
- 6Closing and fundingOnce approved, closing is scheduled and final documents are signed. On a refinance you then have a three-day right of rescission that must expire before the loan funds and records.
After you close
Servicing after closing.
Once your loan funds, the day-to-day handling of it moves to the Reverse Mortgage Servicing Department, the portal used across the industry. These two are worth bookmarking.
That said, we're here for you for the life of your loan. Call Reverse Freedom Mortgage for your basic questions and reviews — you won't need the 1-800 servicing line. Call us first; we can usually help.
Other options
The HECM isn't the only reverse mortgage.
The FHA-insured HECM is what this page calculates. There's also a second family — proprietary reverse mortgages — that aren't government-insured and follow their own rules.
- Different names, same ideaDepending on the lender they're called Platinum, Secure Equity, or HomeSafe. Each has its own qualifying factors, loan amounts, and interest rate factors.
- CondominiumsSome condos don't qualify for a HECM. A proprietary program is often the way to go.
- Higher-valued homesA HECM sizes the loan on the FHA limit of $1,249,125 no matter what the home is worth. Above that, a proprietary loan may lend on more of the value.
Every situation is different, and the right product depends on what you're trying to accomplish. Call or text Chad and he'll help you work out which one fits.
Your next step
Let's find out what your home can do for you.
Here's what I know: every situation is its own. This page will give you a real idea of what's possible, but it can't replace a conversation about what your options actually look like.
Reach out and I'll put together a personalized evaluation — your actual principal limit, today's expected rate, an itemized cost figure, and as many scenarios as you'd like to run. A reverse mortgage is not one size fits all. It gets tailored to your situation and to the chapter of life you're in.
Call or text me directly, or send the short form and I'll have what I need to schedule your evaluation. There's no cost and no obligation. I love the planning side of this work, and I love this program.
Send my numbers to Chad Peck
Chad will be notified and will reach back out to schedule your consultation. In the meantime, feel free to call or text him at 801-809-3872 for a faster response.
- Home value
- —
- Available to you
- —
- Age of youngest borrower
- —
Got it — thank you
Chad will be in touch shortly.