If you are considering a reverse mortgage on your home as a means of helping fund your golden years, you can eliminate some of the mystery about how much you can reasonably expect in the way of a reverse mortgage loan by using a reverse mortgage calculator.
You can choose a reverse mortgage calculator from one of the dozens available online. They all require you to input some data concerning your home's estimated worth, but are relatively easy to use and will be the quickest way you have of determining if taking a reverse mortgage on your home will be a financially prudent move.
The AARP--American Association of Retired Persons--website has an extremely user-friendly reverse mortgage calculator; it generates more traffic than any other. The AARP reverse mortgage calculator requires that you supply information on your age, the age of your spouse, your zip code, and the estimated value of your home. By inputting this information into the reverse mortgage calculator, you will be taking the first steps to determine if you want to pursue the reverse mortgage process.
The accuracy of the estimate you receive will depend on the accuracy of the information you give to the reverse mortgage calculator. Reverse mortgages are a form of financing entirely different from traditional mortgages, and while the AARP reverse mortgage calculator gives an estimate based on the current value of your home, other calculators will ask for both the current value of your home and the remaining balance on any existing mortgage you have.
A sophisticated reverse mortgage calculator will be able to factor in information like the total amount of money you would like from a reverse mortgage and the manner in which you wish to receive it--in cash, as monthly payments, as a line of credit, or as all three. After you have supplied the requested information, the calculator will automatically run the figures and come up with a fairly good picture of what you can reasonably expect by taking out a reverse mortgage.
A reverse mortgage calculator, no matter how sophisticated, offers approximate mortgage amount estimates for national reverse mortgage programs, and cannot factor in cost variables in your area. Local lenders can add application, originating, closing, and termination fees to your reverse mortgage, and some of them will be accruing interest for the duration of the loan. The amount of money you actually receive will be affected by such fees.
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