Step 1. Enter your property zip code, estimated value and any mortgage balances
Your zip code is important and allows ARLO™ to access accurate 3rd party closing costs such as title fees, recording and local taxes (if applicable) in your area.
If you are unsure about your estimated home value, we will be happy to return a list of recent sales an appraiser will most likely use to compare to your home when determining their property estimate.
Step 2. Enter your age
Your principal limit is based on the youngest borrower’s age. This step only assures your calculations are returned as accurately as possible.
If you are uncomfortable about using your birth date, give us the month and year but just use the first of the month for now. An exact date is better as amounts can change based on ages, but this would work for a start.
Step 3. View Your Analysis
The results ARLO™ will show you will also include special program recommendations based on your individual goals.
You can review various options such as adjusting the amount of funds you would like to withdraw at closing. This allows you to view amortization schedules in advance.
With ARLO™, you get the information to allow you to decide which program costs less over time, which carries the least origination fees and which program best meets your needs!
- Do not forget to include your spouse’s age, even if they are not yet 62 as loan proceeds are always based on the age of the youngest spouse.
- When you close a reverse mortgage within 6 months of your next birthday, your calculations automatically move you into the next year’s principal limit factor (if you are very close, it might benefit you to wait a few weeks).
- If you have a HELOC (Home Equity Line of Credit), be sure to include this balance as part of the total mortgage payoff.
What’s Included in Your Quote?
- Side-by-side loan comparisons
- Real-time interest rates + APR
- Estimate of closing costs
- Amortization Schedules
- Personalized Program Recommendations
The results will display all programs for which you are eligible including real-time interest rates and custom amortization schedules, but remember, it is always your call. We give you the information to make an educated decision.
As always, we are always here to answer any questions you may have.
How does a reverse mortgage calculator work?
Are all reverse mortgage calculators the same?
All the calculators use the HUD calculations to determine how much money the loan will give you. HUD determines how much money borrowers will receive based on their ages, the property value or HUD lending limit and interest rates but that does NOT mean that all calculators are the same! At All Reverse, we developed ARLO which is the All Reverse Loan Optimizer. ARLO does something almost no other lender’s calculator will do. He gives you accurate information on all costs in your area instantaneously but aside from that, he quotes you all fees associated with getting a reverse mortgage loan – even those that are not lender fees and for which we are under no obligation to disclose. ARLO could be like some other calculators and “forget” to mention that in some states they also have additional fees that run another $2500 or more that may make their fees look lower, but just because the fees are not mentioned on the calculator results doesn’t mean that the state doesn’t charge them anyway. They are not a lender “junk fee”, it is a state fee that all borrowers must pay, and lenders know it so we believe that borrowers should not only find out about it when they go to close their loan. When you use ARLO, all fees are disclosed even when they have nothing to do with All Reverse Mortgage, Inc.
How much money do you get on a reverse mortgage?
What percentage of appraised value can you get on a reverse mortgage?
How do interest rates affect the reverse mortgage calculation?
How is the line of credit growth rate calculated?
The credit line growth rate is based on the unused portion of the line of credit. For any funds remaining in the line of credit, the line grows at a rate equal to the interest and mortgage insurance premium (MIP) that would be accruing on those remaining funds for as long as they remain unused. E.g., if your interest rate is 4.5% and the MIP is .5% the total interest and MIP that would accrue on the funds is 5%. If you have $50,000 left on the line that you did not use and therefore did not accrue that 5%, that $2,500 (5% of $50,000) is then added to the line of credit and is available to you in an increased line amount. The next year you would have $52,500 available. If the funds were not used in the following year, the growth would be computed on the balance or $52,500. Any funds borrowed would no longer be included in the growth calculation. You must remember that the funds only grow on the unused portion of the line. There is no growth in funds already used as they are accruing interest, so they do not result in an increase in the amount available to borrowers. The growth is not interest borrowers are earning. This is not a bank account where you have money sitting and where you are accruing interest. It is an increase in your line and if you borrow those funds, you or your heirs owe those funds when the loan becomes due. If you decide never to borrow them, there are no funds available to heirs, but you and your estate do not owe them either. The equity remains in the home for you or your estate if you do not borrow the money.
How do interest rates affect the reverse mortgage calculation?
How are monthly payments calculated on a reverse mortgage?
Monthly payments are determined by the amount of money available to the borrower and the term you have chosen to receive the funds. For example, if you choose the payment for life program (the tenure payment) and you are 62 years of age, the payments will need to last for many years. If you are in your ninety’s the payment duration would be less. Also, if your home is worth $800,000 there will be more proceeds to use for payments than if it is worth $100,000 (and this is also affected by any loans/liens on the property as that also could change the amount available to the borrower). There is also a shorter-term payment borrowers can opt for that allows them to choose the amount they receive each month up to their full amount available. The reverse mortgage calculator uses the borrower’s age, interest rates, property value, program limitations (if any), and the growth of the line of credit to determine how much money the borrower can receive on the tenure payment while setting the parameters for the term payment.
How is the lump sum calculated?
The lump sum is calculated based on whether the loan is being used to purchase a home or the amount the borrowers owe on current mortgages and liens for all programs, but then future funds availability will depend on the program you choose and how much of your Principal Limit you use on the lump sum payment. All programs can take up to 100% of their Principal Limit in a lump sum if the funds are needed to purchase a home or to pay off existing loans. If the loan is not being used to purchase or pay off existing loans, then there can be a limit on the initial draw. Prior to a change in 2014, the lump Sum was exactly that, a lump sum of the entire Principal Limit for which the borrower qualified under the program. The lump sum of the entire Principal Limit was an option the borrower received for the fixed rate loan or could be an election the borrower took under the adjustable line of credit. Borrowers wanting a fixed rate loan are required to take a lump sum draw as there are no subsequent draws allowed under the fixed rate program whereas borrowers who opt for the line of credit can receive multiple draws under the program.
Are HECM loans calculated differently than proprietary/jumbo reverse mortgages?
HUD typically allows more loans as a percentage of the value of the home and therefore, the loans are higher than they would be for the jumbo or proprietary loans up to the HUD limits (and sometimes a little over the HUD limits). However, since the Jumbo or proprietary loans allow for much greater limits, properties that are valued much higher than the 2022 HUD limit of $970,800 can receive more money from the proprietary loans on these more valuable properties.