How a reverse mortgage works
Unlike a traditional mortgage, where you make payments to a lender, a reverse mortgage pays you a portion of the value you’ve built up in your home.
Reverse Mortgage Calculator
Update the pre-filled example below with your own information to see a personalized calculation.
Sample Proceeds
$259,350
Mortgage Payoff
$90,000
Remaining Equity
$310,650
Cash Available
$147,621
Values provided are only an estimate. Actual proceeds vary based on (i) your home's appraised value, (ii) loan amount, and (iii) actual closing costs based on your geographic location and the third-party settlement service providers selected. Additionally, certain property charges may be set-aside from loan proceeds reducing the amount otherwise available for distribution if the financial assessment requires the establishment of a Life Expectancy Set Aside ("LESA") account. HomeSafe values are for the HomeSafe standard product only.
You may be eligible for even more.
Speak to a licensed specialist to better understand your options at (800) 841-4626
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Remaining Mortgage Balance
What is a reverse mortgage?
A reverse mortgage is a loan that allows you to turn a portion of your home equity into cash—without required monthly payments.1 If you’re a homeowner age 55 or older2, a reverse mortgage may be a valuable option for gaining financial flexibility and achieving your goals. Many use the funds to supplement income, make home improvements, address medical expenses, establish an emergency fund, or simply enjoy retirement.
1The borrower must meet all loan obligations, including living in the property as the principal residence and paying property charges, including property taxes, fees, hazard insurance. The borrower must maintain the home. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
Reverse mortgage pros and cons
Reverse mortgages can be a powerful tool, but they’re not for everyone. Considering the pros and cons can help you decide if this strategic tool fits your situation and goals.
Pros
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Eliminate your monthly mortgage1
A reverse mortgage pays off your existing mortgage (if any), freeing up your budget from those payments and leaving more cash in your pocket to use as you see fit.
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Flexible payment options
You can access any remaining equity in a way that best suits your lifestyle, including as a lump sum, monthly installments, or as a line of credit that’s ready when you need it.
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Continue to own and live in your home3
The property title remains in your name, and you can continue living in your home as long as you wish, so long as you comply with the loan terms.
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Tax-free cash for virtually anything4
Your loan proceeds are not considered income, which gives you access to usable cash without tapping other investments and creating a taxable event.
Cons
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Loan balance accrues interest
Because your funds come in the form of a loan against your home equity, the balance accrues interest and will grow over time.
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Upfront costs
Like many mortgage products, the loan has closing costs and fees, but many of these can be rolled into the loan and are not paid out of pocket.
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Estate impacts
Because the loan draws from equity and accrues interest on the amount borrowed, it is likely to impact what your heirs inherit. But regardless of how much equity remains when the loan comes due, they will not inherit the debt.
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Potentially not enough
There is a chance that your loan may not be enough to meet your needs, but even if your proceeds run out, you still own your home and can stay in it as long as you meet the loan requirements.3
1The borrower must meet all loan obligations, including living in the property as the principal residence and paying property charges, including property taxes, fees, hazard insurance. The borrower must maintain the home. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
3The right to remain in the home is contingent on paying property taxes and homeowner’s insurance, maintaining the home, and complying with the loan terms.
4Not tax advice. Consult a tax professional.
Real reverse success stories
See how thousands of homeowners nationwide have trusted our suite of home equity solutions to create peace of mind and find joy in living their next chapter to the fullest.
Finance of America Reverse LLC borrowers have been compensated for their participation. Their statements are their own.
Craig
HomeSafe Customer
Dennie & Hassan
HomeSafe Customer
Better Business Bureau®
A+ rated and accredited
4.7 Stars by
verified customers5
Best Reverse
Mortgage Lender6
Best Reverse Mortgage
Companies 20257
Have questions?
A HECM reverse mortgage is a loan exclusively available to homeowners 62+ that converts a portion of home equity into usable cash with no required monthly mortgage payments.* Learn More
*The borrower must meet all loan obligations, including living in the property as the principal residence, maintaining the home, and paying property charges, including property taxes, fees, hazard insurance. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
HomeSafe is a proprietary jumbo reverse mortgage available to homeowners 55+* that converts up to $4 million in home equity into usable cash. Learn More
*For certain HomeSafe products only, excluding Massachusetts, New York, and Washington, where the minimum age is 60, and North Carolina and Texas where the minimum age is 62.
HomeSafe Second is a second lien and HELOC alternative that turns a piece of home equity into cash without the burden of a new monthly mortgage payment or the need to refinance.*
*The borrower must meet all loan obligations, including meeting all loan obligations under the first lien mortgage, living in the property as the principal residence and paying property charges, including property taxes, fees, hazard insurance. The borrower must maintain the home. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
A reverse mortgage loan allows you to unlock a portion of equity in your home with no required monthly mortgage payment.* The loan balance grows over time and is typically repaid when you sell the home, no longer use it as your primary residence, pass away, or don’t comply with the loan terms. Learn More
*The borrower must meet all loan obligations, including living in the property as the principal residence, maintaining the home, and paying property charges, including property taxes, fees, hazard insurance. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
In addition to interest, reverse mortgage costs can include a property appraisal fee, origination fee, closing costs, servicing fee, and a modest charge for independent counseling. Most of these upfront costs can be rolled into the loan itself, and while closing costs vary based on the type and size of the loan, they’re similar to those for any traditional mortgage.
Important legal disclaimers
1The borrower must meet all loan obligations, including living in the property as the principal residence and paying property charges, including property taxes, fees, hazard insurance. The borrower must maintain the home. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
2For certain HomeSafe products only, excluding Massachusetts, New York, and Washington, where the minimum age is 60, and North Carolina and Texas where the minimum age is 62.
3The right to remain in the home is contingent on paying property taxes and homeowner’s insurance, maintaining the home, and complying with the loan terms.
4Not tax advice. Consult a tax professional.
5As of May 2025. Rating based on verified reviews from Trustpilot.com.
6Finance of America is listed as Best Reverse Mortgage Lender by Bankrate in Best reverse mortgage lenders in 2025.
7Finance of America is listed as Best Reverse Mortgage Companies by money.com in Finance of America Reverse Mortgages Review. Finance of America is a paid advertiser with money.com.
