Reverse mortgage loan balance calculator for 2026
Last updated: · Reviewed by Simply Approved Mortgages (NMLS #2620881)
See how a HECM balance accrues over time and what that leaves in remaining home equity. The balance grows at the note rate plus the 0.5% annual FHA mortgage insurance premium, while the home may appreciate at a different rate.
Get your Reverse Mortgage Estimate Summary.
Complete the short estimate form and we send back a full HECM summary: your estimated principal limit, complimentary home value estimate, payoff of any existing mortgage, and estimated proceeds available to you.
- Complimentary home value estimate
- Estimated principal limit for your age
- Existing mortgage payoff included
- Lump sum, line of credit, or monthly options
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Subject to HUD counseling, appraisal, credit and income review, and final lender approval. You remain responsible for property taxes, insurance, and home maintenance.
Estimate summary
- Home value estimate
- $412,000
- Youngest borrower age
- 72
- Estimated principal limit
- $219,400
- Existing mortgage payoff
- $68,000
- Estimated proceeds available
- $151,400
Simply Approved Mortgages • NMLS #2620881 • Equal Housing Opportunity
Your assumptions
Balance accrues at about 7.500% per year including annual MIP.
Home values can fall as well as rise; try a negative rate to stress-test.
Sources: HUD — HECM Program; CFPB — Reverse Mortgages
After 15 years with no voluntary payments or new draws.
At 3.0% annual appreciation.
Home value minus loan balance; never below zero thanks to non-recourse protection.
Year-by-year balance and equity
| Year | Age | Loan balance | Home value | Remaining equity |
|---|---|---|---|---|
| 0 | 70 | $200,000 | $500,000 | $300,000 |
| 2 | 72 | $232,258 | $530,450 | $298,192 |
| 4 | 74 | $269,720 | $562,754 | $293,035 |
| 6 | 76 | $313,223 | $597,026 | $283,803 |
| 8 | 78 | $363,744 | $633,385 | $269,641 |
| 10 | 80 | $422,413 | $671,958 | $249,545 |
| 12 | 82 | $490,545 | $712,880 | $222,336 |
| 14 | 84 | $569,666 | $756,295 | $186,629 |
| 15 | 85 | $613,890 | $778,984 | $165,093 |
Illustrative projection at constant assumed rates. Servicing fees, new draws, set-asides, and rate changes will move the real numbers.
What is a reverse mortgage loan balance?
The loan balance on a HECM is the sum of everything you have drawn, plus financed closing costs, plus accrued interest and the annual FHA mortgage insurance premium. Because no monthly principal and interest payment is required, that balance compounds — which is the trade-off for having the payment obligation removed.
Equity is simply the other side of the same ledger. In a market where appreciation runs close to the accrual rate, equity holds up reasonably well; in a flat or declining market, it erodes faster. The non-recourse feature caps the downside: the debt can never exceed the home’s value at repayment.
Your numbers plus the 2026 Reverse Mortgage Guide.
Request your estimate and we include the 21-page plain-English guide: who qualifies at 62+, what a HECM costs, payout options, ongoing obligations, and the questions to ask before you sign.
- 21-page guide, no jargon
- HUD/FHA program rules explained
- Costs and fees broken down
- Questions to ask any loan officer
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Subject to HUD counseling, appraisal, credit and income review, and final lender approval. You remain responsible for property taxes, insurance, and home maintenance.
Estimate summary
- Home value estimate
- $412,000
- Youngest borrower age
- 72
- Estimated principal limit
- $219,400
- Existing mortgage payoff
- $68,000
- Estimated proceeds available
- $151,400
Simply Approved Mortgages • NMLS #2620881 • Equal Housing Opportunity
Expert insight from Simply Approved Mortgages
Families are usually most concerned about what heirs inherit. The honest framing is that a reverse mortgage converts future equity into present cash flow, and this table makes that visible rather than leaving it to a sales pitch.
If preserving a specific inheritance amount matters, model it here with conservative appreciation, then discuss partial voluntary payments — on an adjustable-rate HECM those payments generally restore the credit line, so they are not one-way.
Simply Approved Mortgages NMLS #2620881. Reverse mortgage loans funded by third-party HUD-approved HECM lenders.
Get my estimate with your real numbers
A licensed loan officer will project your balance and equity using current rates and your actual property — no obligation.
- • Personalized HECM estimate based on your actual age and home value
- • Complimentary home value estimate when you provide your address
- • Side-by-side comparison of HECM vs. HELOC vs. cash-out refinance vs. downsizing
- • Help scheduling independent HUD-approved counseling
See your reverse mortgage numbers on paper.
A licensed Simply Approved Mortgages loan officer reviews your estimate with you — line by line — so you can compare a HECM against a HELOC, a refinance, or staying put.
- Side-by-side payout comparison
- Upfront and ongoing cost estimate
- HUD counseling walked through
- Answers to your heirs questions
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Subject to HUD counseling, appraisal, credit and income review, and final lender approval. You remain responsible for property taxes, insurance, and home maintenance.
Estimate summary
- Home value estimate
- $412,000
- Youngest borrower age
- 72
- Estimated principal limit
- $219,400
- Existing mortgage payoff
- $68,000
- Estimated proceeds available
- $151,400
Simply Approved Mortgages • NMLS #2620881 • Equal Housing Opportunity
Reverse mortgage loan balance — FAQ
- How does a reverse mortgage loan balance grow?
- The balance grows each month by accrued interest at the note rate plus the 0.5% annual FHA mortgage insurance premium, plus any servicing fee and any new draws. Because no monthly principal and interest payment is required, interest compounds on a rising balance.
- Will I ever owe more than my home is worth?
- A HECM is a non-recourse loan. When the loan becomes due, neither you nor your heirs owe more than the home's value at that time. If heirs want to keep the home, they can pay the lesser of the loan balance or 95% of the current appraised value.
- What happens to my home equity over time?
- Remaining equity is the home's value minus the loan balance. Whether equity grows or shrinks depends on whether appreciation outpaces the rate at which the balance accrues. This tool shows both lines side by side so you can compare them.
- Can I make payments to slow the balance?
- Yes. Voluntary prepayments are allowed at any time with no prepayment penalty, and on an adjustable-rate HECM a payment generally restores that amount to your available line of credit.
- When does the loan have to be repaid?
- The loan becomes due and payable when the last surviving borrower or eligible non-borrowing spouse no longer lives in the home as a principal residence, sells the home, dies, or fails to meet loan obligations such as property taxes, insurance, and upkeep.
- Does the projection guarantee future values?
- No. Interest rates and home values change. This is an educational projection using assumptions you select, not a forecast, quote, or approval.
- Is the interest tax deductible as it accrues?
- Generally no. Interest on a reverse mortgage is typically deductible only when the loan is repaid, and deductibility depends on your circumstances. Consult a tax advisor — Simply Approved Mortgages does not provide tax advice.
Keep learning about reverse mortgages
- Heirs and non-recourse
What your family owes and their options.
- Paying off early
Voluntary payments and payoff rules.
- Reverse mortgage calculator
Estimate your principal limit and net cash.
- Credit line growth calculator
Project the unused line over time.
- Tax implications
How proceeds and interest are treated.
- Get my estimate
Talk to a licensed loan officer.
References & sources
Every statistic, program rule, and regulatory claim on this page is sourced from the primary U.S. government agencies and industry bodies listed below. We never source program facts from competing brokers, blogs, or unverified secondary sources.
Source links are maintained by Simply Approved Mortgages and verified periodically. Federal program rules can change — always confirm current-year specifics with HUD, the CFPB, or a HUD-approved counselor before acting on any information on this page.
Keep reading: the next steps most people take
Related reverse mortgage articles, rate updates & HECM guides
New reverse mortgage articles are publishing soon. In the meantime, browse upcoming categories:
Documents required for a reverse mortgage
When you apply for a HECM reverse mortgage, your lender will request documents that verify your identity, property ownership, income, and assets. Gathering these in advance can speed up your estimate and application.
- Government-issued photo ID
Current driver’s license, passport, or state-issued ID.
- Social Security number verification
Social Security card or award letter showing your SSN.
- Current mortgage statement
Most recent statement if refinancing; purchase agreement if buying.
- Homeowner’s insurance declarations page
Shows current coverage, premium, and mortgagee clause.
- Property tax statement or receipt
Latest county tax bill showing taxes are current or payment history.
- Bank statements
Last 1-2 months to verify closing funds and residual reserves.
- Investment or retirement accounts
Recent statements for IRA, 401(k), brokerage, or other liquid assets.
- HOA or condo information
Homeowners association statement or condo questionnaire if applicable.
- Trust or title vesting documents
Required when the home is held in a living trust or entity.
- Flood insurance declaration
Current policy if the property is in a flood zone.
- HUD-approved counseling certificate
Required before loan application. Obtained from a HUD-approved reverse mortgage counselor.
Why we pull credit for your reverse mortgage pre-approval
HUD requires a Financial Assessment for every HECM reverse mortgage, including a review of your credit history and record of paying property taxes and homeowners insurance. As part of our standard broker/lender pre-approval process, we typically order a tri-merge credit report through a HUD-approved credit vendor to verify identity, review obligations, and confirm that you can continue paying property taxes, homeowners insurance, and maintenance after closing. Whether a tri-merge is required, and any fees, are set by the wholesale lender and credit vendor — not by HUD as a stand-alone rule.
Pay for your credit report — SmartPay
Simply Approved Mortgages uses MeridianLink SmartPay to securely collect the credit report fee for your reverse mortgage pre-approval. Payment goes directly to the credit vendor — not to us — and unlocks a tri-merge credit report (Equifax, Experian, TransUnion) that your loan officer uses to complete the broker/lender pre-approval file for HUD's Financial Assessment.
- Secure, PCI-compliant checkout hosted by MeridianLink
- Standard step in our broker/lender pre-approval process (not a HUD stand-alone requirement)
- Optional — you can decline; your loan officer will explain any impact on your options
You'll be redirected to cic.meridianlink.com (SmartPay).
Check your credit first — $1 trial at MyITINCredit
Before you apply, it's smart to know exactly where your credit stands. MyITINCredit offers a $1 trial for 15 days that includes all three credit reports and scores (Equifax, Experian, TransUnion), plus ongoing credit monitoring so you can catch errors, dispute inaccuracies, and watch for identity theft.
- See all 3 bureau reports & scores before your lender does
- Ongoing monitoring alerts you to new accounts or score changes
- Fix errors early — cleaner credit can widen your reverse mortgage options
You'll be redirected to myitincredit.com. Third-party service — terms apply.
Credit report fees are paid directly to the credit vendor. Simply Approved Mortgages (NMLS #2620881) does not profit from the credit pull. MyITINCredit is an independent third-party service; pricing, terms, and features are set by that provider.
Ready to See Your Reverse Mortgage Numbers?
Get your personalized HECM estimate from a Simply Approved Mortgages licensed loan officer, or run the numbers yourself with our calculator — free, no obligation, no hard credit pull.