A Calculator For Reverse Mortgages
HECM calculators are for illustrative purposes only and should not be used in place of professional financial advice. FHA Home Equity Conversion Mortgage (HECM) program customers can get a broad sense of costs, fees, and loan profits using HECM calculators. In this example, the maximum origination fee allowed under HUD rules is shown for illustrative purposes only, along with an estimated FHA Mortgage Insurance Premium for a loan based on the home value provided, as well as estimated recording fees and taxes and other types of closing costs typically associated with a home purchase. You should keep in mind that these closing expenses might and do vary depending on where you live.
Interest rates and costs can also vary from lender to lender. An index and a margin make up the interest rate on a variable-rate HECM loan. You can see how the "index" (the Monthly Adjusted LIBOR, which we use) changes as interest rates change in the market by using our calculator.
Adding a "margin" will decide the real interest rate that will be charged. Our calculation employs a 175 basis point safety buffer (1.75 percent ). The margins and credits offered by reverse mortgage originators on lender fees and closing charges might vary widely. As soon as the borrower has decided on an originator and has applied for a reverse mortgage, the lender is required to provide them with additional disclosures about the pricing and terms of any reverse mortgages offered by that originator or the borrower's choice. Because it is not a licensed lender or broker, the National Reverse Mortgage Lenders Association (NRMLA) cannot create or provide loans.