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How Much Can You Actually Get From a Reverse Mortgage?
Straight answers on how the amount is calculated, what the loan costs, and who it is right for. No monthly mortgage payment, and you keep the title to your home.
Call during business hours to speak with someone now, or request the guide and a licensed specialist will follow up within 24 to 48 hours.
How much can you get from a reverse mortgage?
Your gross amount, called the principal limit, equals the lesser of your appraised home value or the 2026 FHA maximum claim amount of $1,249,125, multiplied by a principal limit factor set by HUD. That factor depends on the age of the youngest borrower and the expected interest rate. Any existing mortgage, closing costs, and required set-asides come out of that pool before you receive cash.
Principal limit factor tables are published by the U.S. Department of Housing and Urban Development.
Source: HUD HECM program
and CFPB reverse mortgage guide.
Last reviewed: August 26, 2026.
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What a reverse mortgage does, and does not do
A HECM removes your monthly mortgage payment and converts equity into cash while you keep the title. It does not remove property taxes, homeowners insurance, or upkeep, and the loan balance grows over time.
Age 62 or older is the starting point
Age is the first requirement, based on the youngest borrower. FHA also requires a financial assessment reviewing credit history and income.
No monthly mortgage payment
Your existing mortgage is paid off from the proceeds. You still pay property taxes, homeowners insurance, and any HOA dues.
Proceeds are not taxed as income
Funds are loan advances, not income. Medicaid and SSI can still be affected if money is held rather than spent. Ask a tax advisor.
FHA-insured, with counseling built in
HECMs carry FHA insurance and non-recourse protection. Independent HUD-approved counseling is required before you can apply.
You keep the title and stay in the home
You remain on the deed as long as the home is your primary residence and you keep taxes, insurance, and maintenance current.
Your heirs are protected
Non-recourse means heirs never owe more than the home is worth. They can repay and keep it, sell it, or hand it back owing nothing.
What determines your amount
Four inputs decide your number: the age of the youngest borrower, the expected interest rate, your home's value against the FHA cap, and what has to be paid off first. Nobody can quote a percentage without those four.
| Input | How it moves your number |
|---|---|
| Age of the youngest borrower | Older borrowers receive a higher principal limit factor. If a spouse is under 62 and not a borrower, the factor is reduced to reflect their age. |
| Expected interest rate | The single biggest swing factor. HUD applies a 5% floor, where factors are highest. As expected rates rise above that floor, factors fall, often by ten points or more for the same borrower. |
| Home value vs. the FHA cap | The calculation uses the lesser of your appraised value or the 2026 maximum claim amount of $1,249,125. Value above that cap does not increase a HECM. |
| Existing mortgage balance | Any current mortgage is paid off first, from your proceeds. A large remaining balance can consume most or all of the principal limit. |
| Closing costs and set-asides | The FHA initial mortgage insurance premium, origination fee, and settlement charges come out next. A Life Expectancy Set-Aside may also be required by the financial assessment. |
Illustrative example — not a quote
Where the money actually goes
Take a 70-year-old with a home appraised at $400,000 and a $60,000 balance left on the mortgage. The numbers below use a principal limit factor near HUD's 5% expected-rate floor. At today's higher expected rates, the same borrower's factor would be meaningfully lower.
| Maximum claim amount (appraised value, under the FHA cap) | $400,000 |
|---|---|
| Principal limit factor at a 5% expected rate, age 70 | about 46.5% |
| Gross principal limit | about $186,000 |
| Less: existing mortgage payoff | − $60,000 |
| Less: estimated closing costs and initial mortgage insurance premium | − $12,000 to $18,000 |
| Approximate net available to the borrower | about $108,000 to $114,000 |
That last line is the number that matters, and it is the one most reverse mortgage ads leave out. Your actual figures depend on the appraisal, the expected rate the day your case number is assigned, your lender's fee structure, and the financial assessment. A licensed specialist can run your real numbers in a short phone call.
What a reverse mortgage costs
HECM costs include an FHA initial mortgage insurance premium of 2% of the maximum claim amount, a capped origination fee, appraisal and title charges, and an ongoing annual mortgage insurance premium of 0.5% on the loan balance.
| Cost | Typical amount |
|---|---|
| Initial mortgage insurance premium | 2% of the maximum claim amount, paid to FHA at closing |
| Annual mortgage insurance premium | 0.5% per year, charged on the outstanding loan balance for the life of the loan |
| Origination fee | Capped by FHA formula. Lenders may charge less, and some waive it in exchange for a higher margin |
| Appraisal | Varies by market. A second appraisal is occasionally required by FHA |
| Title, recording, and settlement charges | Standard third-party closing costs, similar to a traditional refinance |
| HUD-approved counseling | Modest fee, sometimes waived or reduced based on income. Paid to an independent agency, not the lender |
| Servicing fee | Monthly fee some lenders charge. Many do not. Ask before you apply |
| Interest | Accrues on the balance you have drawn. Nothing accrues on an unused line of credit |
The process, start to finish
Request information, review your numbers with a licensed specialist, complete required HUD-approved counseling, then decide. Most applications close in about 30 to 45 days once submitted.
Call or complete the form
Takes about two minutes. We ask your age, approximate home value, and whether you still carry a mortgage.
Review real numbers with a licensed specialist
Within 24 to 48 hours a licensed specialist walks through your principal limit, the costs, and the net amount you would actually receive. No obligation.
Complete HUD-approved counseling
Required for every HECM borrower. The counselor works for an independent agency, not the lender, and will walk you through the downsides as well as the benefits.
Decide
Apply only if the numbers work for your situation. Declining costs you nothing and does not affect your credit.
Questions about the numbers
Select a question to open the answer. See all FAQs →
Why do payout percentages change over time?
Principal limit factors move with the expected interest rate. HUD applies a 5% floor, and at that floor factors are at their highest for any given age. As expected rates rise above the floor, factors fall, sometimes by ten percentage points or more for the same borrower. That is why a fixed age-to-percentage chart cannot stay accurate, and why the only meaningful number is one calculated on the day your case number is assigned.
Do I need to verify my income?
Yes. Since 2015, FHA has required a financial assessment on every HECM. Lenders document and review your credit history, your record of paying property taxes and homeowners insurance, and your residual income. There is no minimum credit score, but this is not a no-documentation loan. If the assessment raises a concern, the lender may require a Life Expectancy Set-Aside that reserves part of your proceeds to pay taxes and insurance on your behalf.
What if I still owe money on my mortgage?
That is common and it is not a disqualifier. The existing mortgage is paid off first out of your principal limit, which is what eliminates the monthly payment. What matters is whether enough remains afterward to be worth the closing costs. If your balance is large relative to your home value, a specialist should tell you plainly that the numbers may not work.
Can I lose my home with a reverse mortgage?
Yes, under specific conditions. The loan becomes due and payable if you stop paying property taxes or homeowners insurance, fail to maintain the property, or move out of the home for more than 12 consecutive months, including an extended stay in a care facility. Foreclosure is possible in those situations. This is the single most important thing to understand before signing, and it is a required topic in HUD counseling.
Is a line of credit better than a lump sum?
It depends on why you need the money. Interest accrues only on funds you have actually drawn, and the unused portion of a HECM line of credit grows over time at the same rate charged on the balance. Many financial planners favor the line of credit for that reason. A lump sum makes sense when there is a specific large cost to cover. Fixed-rate HECMs generally require taking a single draw.
Is Sarah on this website a real person?
No. Sarah is an AI assistant, not a human being and not a licensed loan officer. Sarah answers general questions about how reverse mortgages work and collects your contact details so a specialist can reach you. Anything involving your specific numbers, a quote, or a loan decision is handled by a licensed human specialist. You can ask to speak with a person at any point, or call 678-866-1955 during business hours.
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Also planning ahead for your family?
Many homeowners looking into a reverse mortgage are also making sure funeral and burial costs are not left to their children.
Learn about final expense coverage