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Total Costs and Model Specifications

Source: AARP Foundation Reverse Mortgage Education Project | April 25, 2003

The true, total cost of a reverse mortgage depends on factors in addition to its various itemized costs. Knowing the specific costs that will be charged on a reverse mortgage is only the first step in understanding its total cost. You also need to understand how that cost will vary based on the other factors.

The Total Annual Loan Cost (TALC) of a reverse mortgage also depends upon
• how long you live in your home; and
• what happens to its value during that time.

In general, the TALC rate is highest when the loan is repaid within a few years after closing—when the upfront costs are still a large part of the total amount owed. On the other hand, TALC rates are lowest when you live longer than other people your age, or when your home's value grows little or declines.

TALC Shortcomings

When they went into effect in the mid-1990s, TALC disclosures were an important step in showing the real costs of reverse mortgages. But since then, a number of problems with these disclosures have arisen.

Most reverse mortgage borrowers choose a creditline. The true cost of these creditlines depends to a large degree on the size and timing of the cash advances requested by the borrower.

But TALC calculations assume that all borrowers will request one-half of their creditline at closing, and none later. This simplifies the math and provides a way to compare different creditlines. But it doesn't show how different the true cost of these loans can be based on a borrower's pattern of creditline advances. And it doesn't show the value of a growing versus a non-growing creditline.

TALC regulations also require lenders to assume that the initial interest rate charged on a reverse mortgage will never change. This also simplifies the math, and provides a single standard of comparison. But if you get a reverse mortgage when interest rates are historically low, they are not likely to stay low for as long as your loan lasts. They probably will go up. So the TALC report you get may underestimate of the true cost of your reverse mortgage.

TALC disclosures also do not address two key considerations for reverse mortgage borrowers:
• the total amount of cash you get from the loan; and
• the amount of equity you or your heirs get to keep at the end of the loan.

AARP's Model Specifications

In 2000, under a grant from the U. S. Department of Housing and Urban Development, the AARP Foundation's Reverse Mortgage Project asked reverse mortgage counselors and lenders to work with the project to create a more complete and customized way to measure costs and benefits.

The result was a set of model specifications for analyzing and comparing reverse mortgages. The specifications are based on a simple way of looking at these loans.

All reverse mortgages turn your home equity into three things:
• loan advances paid to you;
• loan costs paid to the lender and others; and
• leftover equity, if any, paid to you or your heirs at the end of the loan.

Because reverse mortgages turn home equity into only these three things, you can analyze any reverse mortgage by asking three simple questions:
• How much would I get?
• How much would I pay?
• How much would be left at the end of the loan?

At the end of a reverse mortgage, all of your home's value will have been turned into one of these three things: loan advances, loan costs, or leftover equity.

AARP's model specifications are rules for estimating how much of your home's value will have been turned into these three things at various future times. They also show how to estimate a total annual average loan cost for each of these future times.

When a lender or counselor uses computer software based on the specifications, all of these estimates are based on the creditline advances and future interest rate that you select. You can also choose the rate at which you expect your home's value will grow.

By varying these factors, you can see what effect each has on a loan's total cash advances, total cost, and leftover equity. Keep in mind, however, that all of these figures are estimates. The actual figures will depend on:
• the actual creditline advances you select during the loan;
• the actual interest rates charged on the loan; and
• the actual changes in your home's value during the loan.

The model specifications were originally developed to help consumers compare different types of reverse mortgages. But the estimates they produce are also very helpful in understanding any individual loan. They show you the total picture of what would happen to your home equity based on
• how you expect to use your loan,
• what you think will happen to interest rates, and
• what you think will happen to your home's value.

Articles on "Selecting a Counselor" and "Selecting a Lender" in the Key Decisions section of this site explain how to get loan analyses and comparisons that meet the model specifications.

Cost Versus Other Choices

TALC disclosures and other measures estimate the total cost of a HECM. But only you can determine how much it would be worth to you.

How important is it—how much would you pay—to remain in your present home? To help you evaluate the cost of a reverse mortgages, you need to compare it to what may be your two main alternatives:
• selling and moving elsewhere; or
• continuing to live in your present home with your current income and assets.

http://assets.aarp.org/www.aarp.org_/articles/revmort/modspecs2-6-04.pdf

http://assets.aarp.org/www.aarp.org_/articles/money/financial_pdfs/hmm_hires_nocrops.pdf

Loan Types and Costs

| March 21, 2003

The most well-known and widely available reverse mortgage is the federally-insured Home Equity Conversion Mortgage (HECM). This loan is backed by the U. S. Department of Housing and Urban Development (HUD) and can be used for any purpose. It is generally offered by mortgage companies or banks.

Some state and local governments offer low-cost reverse mortgages that generally must be used for one specific purpose only, for example, to make home repairs or pay property taxes. Many of these "public sector" loan programs are only available to homeowners with low or moderate incomes.

"Proprietary" reverse mortgages are owned and backed by the private companies that develop them. These loans can be used for any purpose and are generally the most expensive type of reverse mortgage.

Loan costs can vary by a lot from one type of reverse mortgage to another. Not all reverse mortgages include the same types of loan costs. As a result, the true, total cost of reverse mortgages can be difficult to understand and compare. That is why federal Truth-in-Lending law requires lenders to disclose a "Total Annual Loan Cost" for these loans.

Total Annual Loan Cost

The Total Annual Loan Cost (TALC) combines all of a reverse mortgage's costs into a single annual average rate. TALC disclosures can be useful when comparing one type of reverse mortgage to another. But they also show that the true, total cost of an individual reverse mortgage loan can vary by a lot and can end up being much more—or less—expensive than you might imagine.

TALC disclosures reveal that reverse mortgages generally cost the most when you live in your home only a few years after closing the loan. Short-term TALC rates are very high because the start-up costs are usually a very large part of the total amount that you owe in the early years of the loan. But as your loan balance grows larger over time, the start-up costs become a smaller part of your debt. As these costs are spread out over more and more years, the TALC rate declines.

If the loan's growing balance catches up to the home's value, your debt is then generally limited by that value. This makes the true cost of the loan decrease at a faster rate. So the longer you live in your home, or the less its value grows, the less expensive your loan is likely to be.

But TALC rates aren't the only way to measure reverse mortgage costs. An article on "Total Costs & Model Specifications" in the Basics section of this site shows a more complete way to measure and compare the costs and benefits of reverse mortgages.

Glossary of Reverse Mortgage Terms

| March 28, 2003

acceleration clause - the part of a contract that says when a loan may be declared due and payable

adjustable rate - an interest rate that changes, based on changes in a published market-rate index

appraisal - an estimate of much a house would sell for if it were sold; also called its market value

appreciation - an increase in a home's value

Area Agency on Aging (AAA) - a local or regional nonprofit organization that provides information on services and programs for older adults

cap - a limit on the amount an adjustable interest rate may go up or down during a specified time period

closing - a meeting where documents are signed to "close the deal" on a mortgage; the time a mortgage begins

CMT rate – the Constant Maturity Treasury rate, used as an interest rate index in the HECM program

condemnation - a court action saying a property is unfit for use: also, the government taking private property to use for the public by the right of eminent domain

creditline - a credit account that lets a borrower decide when to take money out and also how much to take out; also known as a "line-of-credit" or "credit line."

current interest rate – in the HECM program, the interest rate currently being charged on a loan, which equals one of the HUD-approved interest rate indices (1-month CMT, 1-year CMT, or 1-month LIBOR) plus a margin

deferred payment loans (DPLs) - reverse mortgages that give you a lump sum of cash to repair or improve a home; usually offered by state or local governments

depreciation - a decrease in the value of a home

eminent domain - the right of a government to take private property for public use; for example, taking private land to build a highway

expected interest rate - in the HECM program, the interest rate used to determine a borrower's loan advance amounts; it equals either the 10-year CMT or the 10-year LIBOR rate plus a margin (see below)

Fannie Mae - a private company that buys and sells mortgages; a government-sponsored business that is watched over by the federal government

Federal Housing Administration (FHA) - the part of the U. S. Department of Housing and Urban Development (HUD) that insures HECM loans

federally insured reverse mortgage - a reverse mortgage guaranteed by the federal government so you will always get what the loan promises; also, a Home Equity Conversion Mortgage (HECM)

fixed monthly loan advances - payments of the same amount that are made to a borrower each month

home equity - the value of a home, subtracting any money owed on it

home equity conversion - turning home equity into cash without having to leave your home or make regular loan repayments

Home Equity Conversion Mortgage (HECM) - the only reverse mortgage program insured by the Federal Housing Administration, a federal government agency

home value limit – in the HECM program, the largest home value that can be used to determine a borrower’s loan advances

initial interest rate - in the HECM program, the interest rate that is first charged on the loan beginning at closing; it equals one of the HUD-approved interest rate indices (1-month CMT, 1-year CMT, or 1-month LIBOR) plus a margin

leftover equity - the sale price of the home minus the total amount owed on it and the cost of selling it; the amount the homeowner or heirs get when the house is sold.

LIBOR – the London Interbank Offered Rate, used as an interest rate index in the HECM program

loan advances - payments made to a borrower, or to another party on behalf of a borrower

loan balance - the amount owed, including principal and interest; capped in a reverse mortgage by the value of the home when the loan is repaid.

lump sum - a single loan advance at closing

margin - in the HECM program, the amount added to an interest rate index to determine the initial, current, and expected interest rates

maturity - when a loan must be repaid; when it becomes "due and payable"

model specifications - rules recommended by AARP for analyzing and comparing reverse mortgages

mortgage - a legal document making a home available to a lender to repay a debt

non-recourse mortgage - a home loan in which the borrower generally cannot owe more than the home's value at the time the loan is repaid

origination - the process of setting up a mortgage, including preparing documents

property tax deferral (PTD) - reverse mortgages that pay annual property taxes; usually offered by state or local governments

proprietary reverse mortgage - a reverse mortgage product owned by a private company

reverse mortgage - a home loan that gives cash advances to a homeowner, requires no repayment until a future time, and is capped by the value of the home when the loan is repaid

right of recission - a borrower's right to cancel a home loan within three business days of the closing

servicing - administering a loan after closing, such as maintaining loan records and sending statements

Supplemental Security Income (SSI) - a federal monthly income program for low-income persons who are aged 65+, blind, or disabled

tenure advances - fixed monthly loan advances for as long as a borrower lives in a home

term advances - fixed monthly loan advances for a specific period of time

Total Annual Loan Cost (TALC) rate - the projected annual average cost of a reverse mortgage including all itemized costs

AARP does not endorse any reverse mortgage lender or product.

Fact Sheet on Reverse Mortgages

| April 25, 2003

Until recently, there were two main ways to get cash from your home:
• you could sell your home, but then you would have to move; or
• you could borrow against your home, but then you would have to make monthly loan repayments.

Now reverse mortgages give you a third way of getting money from your home. And you don't have to leave your home or make regular loan repayments.

A reverse mortgage is a loan against your home that you do not have to pay back for as long as you live there. It can be paid to you all at once, as a regular monthly advance, or at times and in amounts that you choose. You pay the money back plus interest when you die, sell your home, or permanently move out of your home.

Who's Eligible

All owners of the home must apply for the reverse mortgage and sign the loan papers. All borrowers must be at least 62 years of age for most reverse mortgages. Owners generally must occupy the home as a principal residence (where they live the majority of the year).

Single family one-unit dwellings are eligible properties for all reverse mortgages. Some programs also accept 2-4 unit owner-occupied dwellings, along with some condominiums, cooperatives, planned unit developments, and manufactured homes. Mobile homes are generally not eligible.

How They Work

Reverse mortgage loans typically require no repayment for as long as you live in your home. But they must be repaid in full, including all interest and other charges, when the last living borrower dies, sells the home, or permanently moves away.

Because you make no monthly payments, the amount you owe grows larger over time. As your debt grows larger, the amount of cash you would have left after selling and paying off the loan (your "equity") generally grows smaller. But you generally cannot owe more than your home's value at the time the loan is repaid.

Reverse mortgage borrowers continue to own their homes. So you are still responsible for property taxes, insurance, and repairs. If you fail to carry out these responsibilities, your loan could become due and payable in full.

What You Get

These loans can be paid to you all at once in a single lump sum of cash, as a regular monthly loan advance or as a creditline that lets you decide how much cash to use and when to use it. Or you may choose any combination of these payment plans.

Some reverse mortgages are offered by state and local governments. These "public sector" loans generally must be used for specific purposes, such as paying for home repairs or property taxes. Other reverse mortgages are offered by banks, mortgage companies, and savings associations. These "private sector" loans can be used for any purpose.

The amount of cash you can get from a private sector reverse mortgage generally depends on your age, your home's value and location, and the cost of the loan. The greatest cash amounts typically go to the oldest borrowers living in the most expensive homes on loans with the lowest costs.

The amount of cash you can get also depends on the specific reverse mortgage plan or program you select. The differences in available loan amounts can vary greatly from one plan to another. Most homeowners get the largest cash advances from the federally insured Home Equity Conversion Mortgage (HECM). HECM loans often provide much greater loan advances than other reverse mortgages.

What You Pay

The lowest cost reverse mortgages are offered by state and local governments. They generally have low or no loan fees, and the interest rates are typically low or moderate as well. Private sector reverse mortgages are very expensive, and include a variety of costs. An application fee usually includes the cost of an appraisal and a credit report. Other loan costs typically include an origination fee, closing costs, insurance, and a monthly servicing fee. These costs generally can be paid with loan advances, which mean they are added to your loan balance (the amount you owe). Interest is charged on all loan advances.

Reverse mortgages are most expensive in the early years of the loan, and then become less costly over time. The cost can be very high in the short term, and is least costly if you live longer than your life expectancy. The federally insured Home Equity Conversion Mortgage (HECM) is generally less expensive than other private sector reverse mortgages.

Consumers considering a private sector reverse mortgage other than a HECM should carefully consider how much more it may cost before applying. Other articles in The Basics section of this web site's Reverse Mortgages information provide more details on measuring and comparing the total cost of these loans.

Taxes, Estates, and Public Benefits

Reverse mortgages may have tax consequences, affect eligibility for assistance under Federal and State programs, and have an impact on the estate and heirs of the homeowner.

An American Bar Association guide states that generally "the IRS does not consider loan advances to be income." The guide explains that if you receive SSI, Medicaid, or other public benefits loan advances are counted as "liquid assets" if you keep them in an account past the end of the calendar month in which you receive them. If you do, you could lose your eligibility for these programs if your total liquid assets (for example, money you have in savings and checking accounts) are greater than these programs allow.

A "reverse" mortgage : Basic Loan Features

Basic Loan Features

| March 21, 2003

Although there are different types of reverse mortgages, all of them are similar in certain ways. Here are the features that most have in common.

Homeownership

With a reverse mortgage, you remain the owner of your home just like when you had a forward mortgage. You are still responsible for paying your property taxes and home-owner insurance and for making property repairs.

When the loan is over, you or your heirs must repay all of your cash advances plus interest. Reputable lenders don't want your house; they want repayment.

Financing Fees

You can use the money you get from a reverse mortgage to pay the various fees that are charged on the loan. This is called "financing" the loan costs. The costs are added to your loan balance, and you pay them back plus interest when the loan is over.

Loan Amounts

The amount of money you can get depends most on the specific reverse mortgage plan or program you select. It also depends on the kind of cash advances you choose. Some reverse mortgages cost a lot more than others, and this reduces the amount of cash you can get from them.

Within each loan program, the amounts you can get generally depend on your age and your home's value:
• The older you are, the more cash you can get; and
• The more your home is worth, the more cash you can get.

The specific dollar amount available to you may also depend on interest rates and closing costs on home loans in your area.

Debt Payoff

Reverse mortgages generally must be "first" mortgages, that is, they must be the primary debt against your home. So if you now owe any money on your property, you generally must either:
• pay off the old debt before you get a reverse mortgage; or
• pay off the old debt with the money you get from a reverse mortgage.

Most reverse mortgage borrowers pay off any home debt with a lump sum advance from their reverse mortgage. You may not have to pay off other debt against your home if the prior lender agrees to be repaid after the reverse mortgage is repaid. Generally only state or local government lending agencies are willing to consider "subordinating" their loans in this way.

Debt Limit

The debt you owe on a reverse mortgage equals all the loan advances you receive (including any you used to finance the loan or to pay off prior debt), plus all the interest that is added to your loan balance. If that amount is less than your home is worth when you pay back the loan, then you (or your estate) keep whatever amount is left over.

But if your rising loan balance ever grows to equal the value of your home, then your total debt is generally limited by the value of your home. Put another way, you generally cannot owe more than what your home is worth at the time the loan is repaid.

The technical term for this cap on your debt is a "non-recourse limit." It means that the lender, when seeking repayment of your loan, generally does not have legal recourse to anything other than your home's value and cannot seek repayment from your heirs. An important exception to this limit on federally-insured reverse mortgages is discussed on theEligibility and Repayment page about these loans.

Repayment

All reverse mortgages are due and payable when the last surviving borrower dies, sells the home, or permanently moves out of the home. (Typically, a "permanent move" means that neither you nor any other co-borrower has lived in your home for one continuous year.)

Reverse mortgage lenders can also require repayment at any time if you:
• fail to pay your property taxes or special assessments;
• fail to maintain and repair your home; or
• fail to keep your home insured.

These are fairly standard "conditions of default" on any mortgage. On a reverse mortgage, however, lenders generally have the option to pay for these expenses by reducing your loan advances and using the difference to pay these obligations. This is only an option, however, if you have not already used up all your available loan funds.

Other default conditions on most home loans, including reverse mortgages, include:
• your declaration of bankruptcy;
• your donation or abandonment of your home;
• your perpetration of fraud or misrepresentation;
• if a government agency needs your property for public use (for example, to build a highway); or
• if a government agency condemns your property (for example, for health or safety reasons).

Changes that could affect the security of the loan for the lender can also make reverse mortgages payable. For example:
• renting out part or all of your home;
• adding a new owner to your home's title;
• changing your home's zoning classification; or
• taking out new debt against your home.

You must read the loan documents carefully to make certain you understand all the conditions that can cause your loan to become due.

Cancellation

After closing a reverse mortgage, you have three days to reconsider your decision. If for any reason you decide you do not want the loan, you can cancel it. But you must do this within three business days after closing. "Business days" include Saturdays, but not Sundays or legal public holidays.

If you decide to cancel, you must do it in writing, using the form provided by the lender, or by letter, fax, or telegram. It must be hand delivered, mailed, faxed, or filed with a telegraph company before midnight of the third business day. You cannot cancel by telephone or in person. It must be written.

Reverse Mortgage Basics: A New Kind of Loan: In Reverse

A New Kind of Loan: In Reverse

| March 21, 2003

A "reverse" mortgage is a loan against your home that you do not have to pay back for as long as you live there. With a reverse mortgage, you can turn the value of your home into cash without having to move or to repay the loan each month. The cash you get from a reverse mortgage can be paid to you in several ways:
• all at once, in a single lump sum of cash;
• as a regular monthly cash advance;
• as a "creditline" account that lets you decide when and how much of your available cash is paid to you; or
• as a combination of these payment methods.

No matter how this loan is paid out to you, you typically don't have to pay anything back until you die, sell your home, or permanently move out of your home. To be eligible for most reverse mortgages, you must own your home and be 62 years of age or older.

Other Home Loans

To qualify for most home loans, the lender checks your income to see how much you can afford to pay back each month. But with a reverse mortgage, you don't have to make monthly repayments. So you don't need a minimum amount of income to qualify for a reverse mortgage. You could have no income and still be able to get a reverse mortgage.

With most home loans, you could lose your home if you don't make your monthly payments. But with a reverse mortgage, there aren't any monthly repayments to make. So you can't lose your home by not making them. Most reverse mortgages require no repayment for as long as you—or any co-owner(s)—live in the home. So they differ from other home loans in these important ways:
• you don't need an income to qualify for a reverse mortgage; and
• you don't have to make monthly repayments on a reverse mortgage.

"Forward" Mortgages

You can see how a reverse mortgage works by comparing it to a "forward" mortgage — the kind you use to buy a home. Both types of mortgages create debt against your home. And both affect how much equity or ownership value you have in your home. But they do so in opposite ways.
"Debt" is the amount of money you owe a lender. It includes cash advances made to you or for your benefit, plus interest. "Home equity" means the value of your home (what it would sell for) minus any debt against it. For example, if your home is worth $150,000 and you still owe $30,000 on your mortgage, your home equity is $120,000.

Falling Debt, Rising Equity

When you purchased your home, you probably made a small down payment and borrowed the rest of the money you needed to buy it. Then you paid back your traditional "forward" mortgage loan every month over many years. During that time:
• your debt decreased; and
• your home equity increased.

As you made each repayment, the amount you owed (your debt or "loan balance") grew smaller. But your ownership value (your "equity") grew larger. If you eventually made a final mortgage payment, you then owed nothing, and your home equity equaled the value of your home. In short, your forward mortgage was a "falling debt, rising equity" type of deal.

Rising Debt, Falling Equity

Reverse mortgages have a different purpose than forward mortgages do. With a forward mortgage, you use your income to repay debt, and this builds up equity in your home. But with a reverse mortgage, you are taking the equity out in cash. So with a reverse mortgage:
• your debt increases; and
• your home equity decreases.

It's just the opposite, or reverse, of a forward mortgage. With a reverse mortgage, the lender sends you cash, and you make no repayments. So the amount you owe (your debt) gets larger as you get more and more cash and more interest is added to your loan balance. As your debt grows, your equity shrinks, unless your home's value is growing at a high rate.

When a reverse mortgage becomes due and payable, you may owe a lot of money and your equity may be very small. If you have the loan for a long time, or if your home's value decreases, there may not be any equity left at the end of the loan.

In short, a reverse mortgage is a "rising debt, falling equity" type of deal. But that is exactly what informed reverse mortgage borrowers want: to "spend down" their home equity while they live in their homes, without having to make monthly loan repayments. There's more about this important concept in an article called "A 'Rising Debt' Loan" in the Basics section of this site.

Exception

Reverse mortgages don't always have rising debt and falling equity. For example, if a home's value grows rapidly, your equity could increase over time. But most home values don't grow at consistently high rates, so the majority of reverse mortgages end up being "rising debt, falling equity" loans.

Reverse Mortgage Basics: A Rising Debt" Loan "

A Rising Debt" Loan "

| April 17, 2006

The purpose of a reverse mortgage is different from that of a traditional "forward" mortgage. The purpose of a forward mortgage is to purchase a home; the purpose of a reverse mortgage is to get cash from your home.

In a forward mortgage, your loan balance (the amount you owe) gets smaller with each monthly repayments to the lender. Meanwhile the value of your home usually increases. So your home equity grows larger over time as your debt decreases. So forward mortgages are "falling debt, rising equity" loans.

In a reverse mortgage, your loan balance (debt) rises each time you get money from the lender, as interest is added to the outstanding loan balance, and you make no repayments to the lender. Unless the home's value grows very fast, the loan balance starts "catching up" to it. So reverse mortgages are typically "rising debt, falling equity" loans. Table 1 compares a forward mortgage to a reverse mortgage on a step-by-step basis.

Table 1: Comparing "Forward" & Reverse Mortgages

	"Forward" Mortgage	Reverse Mortgage
Purpose of loan	to purchase a home	to get cash from your home
Before closing, borrower has…	no equity in the home	a lot of equity in the home
At closing, borrower…	owes a lot, and	owes very little,
	has little equity	and has a lot of equity
During the loan, borrower…	makes monthly payments to the lender	receives payments from the lender
	loan balance goes down	loan balance rises
	equity grows	equity declines
At end of loan, borrower…	owes nothing	owes substantial amount
	has substantial equity	has much less, little, or no equity
Type of Loan	Falling Debt, Rising Equity	Rising Debt, Falling Equity

A Simplified Reverse Mortgage

Table 2 shows the "rising debt, falling equity" characteristics of reverse mortgages in general. To simplify the example, the table does not include all the closing costs and fees that are generally charged by a mortgage company or bank. It also does not include the costs of selling a home, which typically reduce the amount of equity remaining at the end of the loan.

In this simplified example, you can see that the $1,000 monthly loan advances in column A are added to the monthly interest at 0.5% in column B to equal the loan balance (amount owed) in column C. Over time, the loan balance grows larger. You can also see that the loan balance is subtracted from the home's value (assumed to be growing at 4% per year) in column D to produce the amount of remaining home equity in column D-C.

Table 2: Simplified* Reverse Mortgage Example
Assumptions: Monthly Loan Advance.........$1,000
Monthly Interest Rate...….....0.5%
Original Home Value......…...$200,000
Appreciation Rate.........…….4% per year

	A	B	C	D	(D - C)
End of Year	Principal Advances	Interest @0.5% /month	Loan Balance	Home Value	Home Equity
1	$12,000	$397	$12,397	$208,000	$195,602
2	24,000	1,559	25,559	216,320	190,760
3	36,000	3,532	39,532	224,872	185,339
4	48,000	6,368	54,368	233,971	179,602
5	60,000	10,118	70,118	243,330	173,211
6	72,000	14,840	86,840	253,063	166,222
7	84,000	20,594	104,594	263,186	158,591
8	96,000	27,442	123,442	273,713	150,270
9	108,000	35,453	143,453	284,662	141,208
10	120,000	44,698	164,698	296,048	131,349

* llustrative example only; does not include loan closing costs, mortgage insurance premiums, fees, or home selling costs. For complete cost example, see Federally-Insured Loans: What Are the Costs?

AARP does not endorse any reverse mortgage lender or product.