FHA Reverse Mortgage Calculator
Estimate your proceeds on an FHA-insured HECM — the government-backed reverse mortgage — including the 2026 lending limit and what FHA mortgage insurance actually costs.
Nate Jones · NMLS #304056 · New American Funding
From Nate · 28 sec
Thinking about an FHA reverse mortgage?
Quick context from Nate before you run your numbers.
An FHA reverse mortgage is the Home Equity Conversion Mortgage (HECM), the only reverse mortgage insured by the federal government through FHA/HUD. Homeowners 62+ can convert home equity to tax-free cash with no monthly mortgage payment. Proceeds depend on the youngest borrower's age, interest rates, and home value capped at the 2026 FHA lending limit of $1,149,825. Costs include a 2% upfront FHA mortgage insurance premium plus 0.5% annually — the insurance that makes the loan non-recourse, so you or your heirs never owe more than the home is worth. HUD-approved counseling is required. Nate Jones (NMLS #304056) originates FHA HECMs through New American Funding — free estimate, no credit pull.
Your Numbers
Enter $0 if your home is paid off
FHA requires 62 or older
Current HECM rates typically range 6.5-8.5%
FHA HECM Results
Estimated Available Cash
$198,000
Tax-free. No monthly payments required. FHA-insured.
FHA Maximum Claim Amount
$450,000
Lesser of your home value and the $1,149,825 FHA lending limit for 2026
Principal Limit
$198,000
What FHA guidelines allow based on your age and the expected rate
Estimated FHA Mortgage Insurance
$9,000 upfront
2% of the maximum claim amount at closing (usually financed into the loan), plus 0.5% annually on the balance (~$990 in year one). This insurance is what makes the loan non-recourse.
These are estimates based on simplified FHA HECM guidelines. Actual amounts depend on current expected rates, your specific property, and the FHA appraisal. Nate will run your exact numbers — free, no credit pull.
FHA, HUD, HECM — Same Loan, Three Names
This confuses almost everyone, so let's clear it up. The HECM (Home Equity Conversion Mortgage) is the loan. HUD writes the program rules. FHA— an agency inside HUD — insures it. So an "FHA reverse mortgage," a "HUD reverse mortgage," and a "HECM" are the same product: the only reverse mortgage backed by the federal government. Everything else on the market is a proprietary (private) program, like the jumbo reverse mortgage for homes above the FHA limit.
Why the government backing matters: the FHA insurance guarantees the loan is non-recourse(you or your heirs never owe more than the home's value), guarantees your line of credit or monthly payments keep coming even if your lender disappears, and standardizes the rules every lender must follow.
What FHA Mortgage Insurance Actually Costs
The FHA HECM has two insurance premiums, and knowing them upfront keeps the closing statement from surprising you:
| Premium | Amount | When |
|---|---|---|
| Upfront MIP | 2% of max claim | At closing — usually financed into the loan |
| Annual MIP | 0.5% of balance | Accrues onto the loan balance each year |
On a $450,000 home that's $9,000 upfront. It's not nothing — but it buys the non-recourse guarantee, which on a loan designed to be held for decades is the single most valuable feature in the program. If the insurance cost bothers you and your home is above the FHA limit anyway, the jumbo reverse mortgage carries no FHA MIP at all.
FHA Reverse Mortgage Eligibility Checklist
Before you spend time on exact numbers, run down the eligibility list. You likely qualify if all of these are true:
- The youngest borrower (or eligible non-borrowing spouse rules apply) is 62 or older
- The home is your primary residence — you live there most of the year
- You own the home outright or have roughly 50%+ equity
- The property is a single-family home, FHA-approved condo, manufactured home meeting FHA standards, or a 2-4 unit property where you occupy one unit
- You're current on federal debts and can demonstrate the ability to pay property taxes, insurance, and upkeep (the financial assessment)
- You complete a HUD-approved counseling session — required by law, typically $125-$200
Miss one of these and there's often still a path — proprietary programs accept some borrowers at 55+, non-approved condos sometimes get single-unit approval, and a spouse under 62 can be a protected non-borrowing spouse. Those situations are exactly when a 10-minute call with Nate saves weeks of guessing.
Related Calculators & Guides
FHA Reverse Mortgage FAQ
Common Questions
How much can I get from an FHA reverse mortgage?
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What does FHA mortgage insurance cost?
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