HECM Reverse Mortgages · Ages 62+

Reverse Mortgage Calculator

See how much home equity you can access through a Home Equity Conversion Mortgage (HECM). Estimates update live based on your age, home value, and existing mortgage balance. No email required.

HUD-approved HECM lender NH · MA · ME · FL · RI FHA-insured
Estimate Your HECM Proceeds
Enter your age, home value, and any existing mortgage balance. Estimates are illustrative — a licensed loan officer provides the exact figures.

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Your Estimated Proceeds

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Estimated Available Equity
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Adjust the inputs to see how much equity you may qualify to access.

Principal Limit
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total HECM availability
Mandatory Obligations
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closing costs + payoffs
Cost Breakdown
Existing mortgage payoff$0
Upfront Mortgage Insurance (2%)$0
Origination fee (HUD capped)$0
Other closing costs (est.)$0
Total obligations$0

This is an estimate. A NextGen HECM specialist can run your exact numbers using current rates, your specific PLF lookup, and HUD's official calculator.

Talk to a HECM Specialist
What is a reverse mortgage

A loan that uses your home equity — without monthly mortgage payments.

A reverse mortgage — formally a Home Equity Conversion Mortgage (HECM) — is a federally insured loan that allows homeowners aged 62 and older to convert part of their home equity into cash without selling the home or making monthly mortgage payments. The loan is repaid when the borrower sells, moves out permanently, or passes away. The borrower retains the title to the home and must continue paying property taxes, homeowners insurance, and maintenance costs.

HECMs are the most common type of reverse mortgage in the United States and the only one insured by the Federal Housing Administration (FHA). The program is administered by HUD and designed specifically to help retirees access home equity without forcing a sale.

How It Differs from a Traditional Mortgage

  • No required monthly mortgage payments. Interest accrues but is not due until the loan is repaid.
  • The loan balance grows over time rather than shrinking, as interest and fees compound onto the balance.
  • You keep title to your home. The lender holds a lien, not ownership.
  • The loan is non-recourse. Neither you nor your heirs will ever owe more than the home is worth at the time the loan is repaid, even if the loan balance has grown above market value.
  • You must continue paying property taxes, homeowners insurance, HOA dues (if applicable), and basic home maintenance. Failure to do so can trigger default.
How the calculation works

How much equity you can actually access.

The amount of home equity you can access through a HECM is determined by three factors set by HUD:

1. Your Age (Youngest Borrower)

Older borrowers can access a higher percentage of their home's value because the actuarial expected loan duration is shorter. A 62-year-old typically qualifies for around 35–45% of home value; an 80-year-old typically qualifies for 55–65%; an 85-year-old can sometimes access 65%+.

2. Current HECM Interest Rate

Higher rates reduce the percentage of home value you can borrow because more of that value is reserved for future interest accrual. When rates were 3% in 2021, principal limit factors were much higher than they are at 7.5% in 2026.

3. The Lesser of Home Value or HECM Lending Limit

The 2026 HECM maximum claim amount is $1,209,750. Homes valued above that figure are still eligible, but the calculation caps at the lending limit. For higher-value homes, some lenders offer non-HECM proprietary "jumbo" reverse mortgages with their own terms.

Age Approximate PLF
at 7.5% rate		 On a $400,000 Home
62~38%~$152,000 principal limit
65~42%~$168,000 principal limit
70~47%~$188,000 principal limit
75~52%~$208,000 principal limit
80~58%~$232,000 principal limit
85~64%~$256,000 principal limit

These are illustrative figures. Exact principal limit factors are published monthly by HUD and vary slightly. A NextGen HECM specialist will run your specific PLF using HUD's official lookup table.

Four ways to receive the money

How you can take your HECM proceeds.

One of the most powerful features of a HECM is flexibility in how you receive the money. The four primary options:

Option How It Works Best For
Lump Sum Receive the entire available amount as a single payment at closing. Paying off the existing mortgage, large one-time expenses, immediate cash needs.
Line of Credit Draw funds as needed. The unused portion grows over time at the current HECM rate plus 0.5%. Long-term financial flexibility, emergency reserves, retirement income smoothing.
Tenure Payments Receive fixed monthly payments for as long as at least one borrower lives in the home. Supplementing retirement income for the rest of your life.
Term Payments Receive fixed monthly payments for a set number of years (e.g., 10 years). Bridging income to a known future event (Social Security delay, pension start).

Many borrowers combine options — for example, taking a partial lump sum to pay off an existing mortgage, then putting the remainder in a line of credit for future flexibility. The calculator above lets you see how each option changes the math.

The growing line of credit is often the most underrated feature. The unused portion of an LOC grows at the HECM rate plus 0.5% — meaning your borrowing capacity actually increases over time, even as your home's market value fluctuates. This can be especially valuable as a long-term financial planning tool.

Important to know

Things every HECM borrower needs to understand.

A HECM is a powerful tool, but it's a serious financial decision. Here's what every prospective borrower should understand before applying:

Borrower Responsibilities Continue
You remain responsible for paying property taxes, homeowners insurance, HOA dues (if applicable), and basic home maintenance for as long as the HECM is in place. Failure to meet these obligations can put your loan in default — which can ultimately lead to foreclosure even though you have no required mortgage payment.

The Loan Balance Grows Over Time

Unlike a traditional mortgage where you pay down principal monthly, a HECM accrues interest that compounds onto the loan balance. Over 15 or 20 years, the balance can grow substantially. This reduces the equity remaining in the home for your heirs.

HUD Mandates Counseling Before You Can Apply

Every HECM borrower must complete an independent counseling session with a HUD-approved counselor before applying. This typically costs $125–$200 and takes 60–90 minutes. The counseling is required by federal law and protects borrowers from rushing into an unsuitable product. NextGen will provide a list of approved counselors when you begin the application process.

Upfront Costs Are Significant

HECM closing costs typically run $10,000–$25,000 depending on home value, primarily from the 2% upfront mortgage insurance premium and the HUD-capped origination fee. Most of these costs are rolled into the loan rather than paid out of pocket, but they do reduce the net proceeds available to you.

The Non-Recourse Protection Is Real

The most important consumer protection in HECMs: the loan is non-recourse. When the loan is repaid (sale, move, or death), neither you nor your heirs can owe more than the home's appraised value at that time. If the loan balance has grown beyond the home value, FHA mortgage insurance covers the difference. Your other assets are never at risk to repay a HECM shortfall.

Your Heirs Have Options

When a HECM becomes due, heirs typically have 6–12 months to decide: (1) pay off the loan balance (or 95% of appraised value, whichever is less) and keep the home, (2) sell the home and keep any remaining equity, or (3) hand the property back to the lender via deed-in-lieu of foreclosure, owing nothing further.

Is it right for you?

When a HECM makes sense — and when it doesn't.

Strong Candidates for a HECM

  • Retirees who plan to stay in their home for at least 5+ more years
  • Homeowners with significant equity but limited cash flow
  • Borrowers who want to eliminate an existing mortgage payment
  • Retirees using the line of credit as a strategic financial planning tool
  • Homeowners whose heirs don't expect or need to inherit the property

HECMs May Not Be the Right Fit For

  • Homeowners planning to move within 2–3 years (upfront costs won't be recovered)
  • Borrowers whose income is so limited they can't reliably pay property taxes and insurance
  • Heirs who specifically want to inherit the home debt-free
  • Homeowners with relatively low equity (under 50%) where net proceeds may be minimal after costs
  • Anyone considering using HECM proceeds to invest in high-risk securities or annuities

The right move is talking to a HECM specialist who can model your specific scenario, walk through alternatives (HELOC, cash-out refinance, home sale + downsize), and refer you to mandatory HUD counseling. NextGen handles all of this in our HECM intake process.

Frequently asked

Common reverse mortgage questions.

A reverse mortgage is a federally insured loan available to homeowners aged 62 and older that converts part of their home equity into cash. The most common type is a Home Equity Conversion Mortgage (HECM), insured by the FHA and administered by HUD. Unlike a traditional mortgage, no monthly mortgage payments are required — the loan is repaid when the borrower sells the home, moves out permanently, or passes away. The borrower retains title to the home.
The amount you can access depends on three factors: the age of the youngest borrower (62+ required), your home's appraised value (up to the 2026 HECM limit of $1,209,750), and current HECM interest rates. As a rough guide, a 62-year-old can typically access 35–45% of home value; a 75-year-old can typically access 50–55%; an 85-year-old can sometimes access 65% or more. Existing mortgage payoffs, closing costs, and the 2% upfront mortgage insurance premium reduce the net proceeds available to you.
Yes. You retain title and ownership of your home with a reverse mortgage. The lender places a lien against the property — the same as with a traditional mortgage — but you remain the legal owner. You can sell the home at any time, leave it to your heirs, or refinance the HECM. The lien is satisfied when the loan is repaid through sale, refinance, or settlement of the estate.
HECM requirements in 2026 include: youngest borrower must be at least 62 years old, the home must be your primary residence, the property must meet FHA standards, sufficient equity must exist (typically 50% or more of home value), and you must demonstrate the ability to continue paying property taxes, homeowners insurance, and home maintenance. You must also complete a mandatory HUD-approved counseling session before applying. There is no minimum income or credit score requirement, but lenders perform a financial assessment to ensure you can meet ongoing obligations.
A reverse mortgage is repaid when one of three events occurs: (1) you sell the home, (2) you no longer use the home as your primary residence for 12 consecutive months, or (3) you pass away. At that point, the loan balance plus accrued interest becomes due. The home is typically sold to repay the loan, and any remaining equity goes to you or your heirs. HECMs are non-recourse loans — neither you nor your heirs will ever owe more than the home's appraised value at the time of repayment, even if the loan balance has grown beyond the home's value.
When the borrower passes away, heirs typically have 6 to 12 months to decide what to do with the property. They have three options: (1) pay off the HECM balance (or 95% of the appraised value, whichever is less) and keep the home, (2) sell the home and keep any remaining equity above the loan balance, or (3) sign a deed-in-lieu of foreclosure to the lender and walk away owing nothing. Because HECMs are non-recourse, heirs are never personally liable for any shortfall — FHA mortgage insurance covers it.
You can lose your home to foreclosure on a HECM if you fail to meet ongoing obligations: paying property taxes, maintaining homeowners insurance, keeping the home in reasonable repair, or continuing to use it as your primary residence. The loan can also become due if you move out for more than 12 consecutive months (including for extended medical care). However, you cannot lose your home simply because the loan balance has grown above the home's value — that's specifically what the FHA non-recourse insurance protects against.
HECM costs typically run $10,000 to $25,000+ depending on home value and lender. The biggest cost is the upfront mortgage insurance premium (2% of the maximum claim amount), followed by the HUD-capped origination fee (up to $6,000), third-party closing costs ($2,500–$5,000 for appraisal, title, recording), and ongoing monthly mortgage insurance (0.5% annually accrued onto the loan balance). Most costs are rolled into the loan rather than paid out of pocket at closing.
What clients say

Real reviews from real homeowners.

A HECM is a serious financial decision. Here's what working with NextGen's HECM specialists actually looks like — verified reviews from homeowners across our footprint.

Ready for personalized numbers?

Get an exact HECM estimate from a specialist.

The calculator gives you a ballpark. A NextGen HECM specialist runs HUD's official PLF lookup with your specific birthdate and current rate, walks you through every disbursement option, and connects you with a HUD-approved counselor — at no cost to you.

Talk to a HECM Specialist

Educational content only — not financial, legal, or tax advice. Calculator results are illustrative estimates based on simplified Principal Limit Factor (PLF) approximations and current HUD program parameters. Actual HECM proceeds depend on HUD's official PLF lookup table at the time of loan application, the specific HECM expected rate, MIP rates, lender origination fees, third-party closing costs, your existing mortgage payoff, and any other liens. Estimates do not include county or state-specific recording fees, intangible taxes, or other regional costs that may apply.

Home Equity Conversion Mortgages (HECMs) are FHA-insured. Borrowers must be 62 or older, complete HUD-approved counseling before applying, occupy the property as a primary residence, and continue paying property taxes, homeowners insurance, HOA dues, and home maintenance. Failure to meet these obligations may result in loan default and foreclosure. The loan becomes due when the borrower sells the home, moves out for more than 12 consecutive months, or passes away. HECMs are non-recourse — borrowers and heirs will never owe more than the home's appraised value at the time of repayment.

NextGen Mortgage Loans is licensed in NH (NMLS# 1621958), MA (MB1621958), ME (1621958), FL (MBR4542), and RI (#20265029LB). All loans subject to credit approval, HUD HECM program guidelines, and product availability. Equal Housing Lender. NextGen Mortgage Loans is not affiliated with any government agency, including HUD or the FHA.