Reverse Mortgage Calculator
Are you considering using a reverse mortgage? Use our helpful mortgage to calculate how a reverse mortgage will work in your scenario.
How are reverse mortgages calculated
Reverse mortgages are unique in the way they are calculated, assessed and charge repayments compared to any other home loan. Designed for retirees as an option to draw funds for lifestyle and living expenses without taking on a cash flow liability, reverse mortgages draw equity off their home and instead of charging a monthly repayment, increase the loan amount accordingly. This creates a situation wherein the debt will continue to rise until either the debt is repaid which is generally when the property it is secured against is sold. To manage the risk of the debt growing larger than the property value, starting loan balances are kept quite low compared to the property value, generally up 25% of the property value. (this is dependent with each lenders policies, the borrowers age and other factors)
Reverse mortgages can be paid as a lump sum, as fortnightly payments or into a loan account wherein interest is only charged as the funds are drawn out – our reverse mortgage calculator will allow you to choose your preferred option and the results will adjust accordingly.
Do you need assistance to find out whether a reverse mortgage would be right for you? Speak with a broker today.
Disclaimer: The calculations do not take into account all fees and charges. The results provided by this calculator are an estimate only, and should not be relied on for the purpose of making a decision in relation to a loan. Interest rates and other costs can change over time, affecting the total cost of the loan. Borrowers should consider discussing their individual situation with a qualified Australian Credit Licensee or authorised Credit Representative.