By Jessica Martinez · Contributing Writer, Business & FinanceEnter your starting loan balance and the combined interest plus mortgage insurance rate. The calculator projects what the balance will be after any number of years, and how long it takes to double.
By Jessica Martinez · Contributing Writer, Business & FinanceAssumes the rate you enter holds steady for the whole term and no voluntary payments are made against the balance.
A conventional mortgage shrinks every month because you send in a payment. A reverse mortgage runs the opposite direction: no payment is due, so the interest that would normally reduce a balance instead piles onto it, compounding annually for as long as the loan is open.
The compounding is the whole story here. A $160,000 starting balance at a 7.5% combined rate becomes roughly $473,000 after fifteen years, not because anything went wrong, but because that is what fifteen years of uncollected interest and mortgage insurance looks like once it compounds. Slow the rate down or shorten the years, and the ending number moves accordingly, since the formula is a plain compound-growth calculation, not a HUD-specific one.
Because no payments happen, "doubling time" stands in for the payoff timeline most borrowers actually want to picture. Lower combined rates push the doubling point out; higher ones pull it in.
| Combined rate | Approx. doubling time | $160,000 becomes roughly |
|---|---|---|
| 5.0% | 14.2 years | $332,629 (at 15 yrs) |
| 6.0% | 11.9 years | $383,449 (at 15 yrs) |
| 7.5% | 9.6 years | $473,420 (at 15 yrs) |
| 9.0% | 8.0 years | $582,797 (at 15 yrs) |
Table generated from the same compound-growth formula the calculator above runs, at a fixed 15-year horizon. It is arithmetic, not a rate forecast; nothing here predicts what rates will actually do.
Want the starting balance this tool assumes? The proceeds calculator gets you there from your age and home value. To see how much cushion you actually have under an 80% ceiling, check the equity math on the home equity page. Prefer to watch the growth unfold row by row instead of jumping straight to an end number? The full year-by-year balance table lays out every year between now and payoff.
Because no monthly payment is required, the interest and the ongoing mortgage insurance premium that would normally come out of your pocket get added to the loan balance instead, every single year.
Add your loan's note rate to the annual mortgage insurance premium, which is typically 0.5 percent, to get a rough combined figure. A lender's disclosure will give you the exact number for your loan rather than an estimate.
It can on paper if the loan runs long enough or home values fall, but federal HECM loans are non-recourse, so neither you nor your heirs would owe the difference. The FHA insurance fund absorbs that gap.
Yes. HECM borrowers can make voluntary partial repayments at any time with no penalty, and any amount paid down stops accruing interest going forward, which this calculator does not model since it assumes no repayments are made.