HECM Calculator 2026
Calculate your Home Equity Conversion Mortgage (HECM) proceeds and compare to proprietary reverse mortgages for high-value homes.
Borrower Information
Home Details
2024 HECM Lending Limit
The maximum home value used to calculate HECM proceeds. Homes worth more may benefit from proprietary reverse mortgages.
HECM (FHA-Insured)
Proprietary Reverse Mortgage
HECM vs Proprietary
15-Year Balance Projection
| Year | HECM Balance | Proprietary Balance | MIP Paid (HECM) |
|---|---|---|---|
| 0 | $351,000 | $307,500 | $1,755 |
| 3 | $423,990 | $366,237 | $7,735 |
| 6 | $512,159 | $436,195 | $14,958 |
| 9 | $618,662 | $519,515 | $23,683 |
| 10 | $658,875 | $550,686 | $26,977 |
| 12 | $747,313 | $618,750 | $34,222 |
| 15 | $902,716 | $736,942 | $46,953 |
HECM balance includes annual MIP of 0.5%. Proprietary has no ongoing MIP but may have higher rates.
HECM Advantages
- FHA-insured - government guarantees you receive your funds
- Non-recourse guarantee - never owe more than home value
- Higher PLFs (more proceeds) for most homes
- Line of credit growth feature
- Required HUD counseling protects borrowers
Proprietary Advantages
- No HECM limit - access equity on high-value homes
- No annual MIP - lower ongoing costs
- Potentially faster closing process
- May accept condos that don't meet FHA requirements
- Flexibility in property types
Protect Your Home, Diversify Your Retirement
A HECM can provide needed cash flow, but compound interest and MIP charges erode your home equity over time. Before tapping your home, consider whether a Gold IRA could meet your retirement income needs while preserving your home for your heirs.
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Important Disclaimer
This calculator provides estimates for educational purposes only. Actual HECM and proprietary reverse mortgage terms vary by lender, location, and individual circumstances. PLF tables are approximate and change based on HUD guidelines. This is not financial advice. Consult a HUD-approved counselor before applying for any reverse mortgage.
Understanding HECM Reverse Mortgages
FHA-Insured Protection
HECM loans are insured by the Federal Housing Administration, guaranteeing you'll receive your funds even if the lender goes out of business.
2024 Lending Limit
The maximum home value for HECM calculations is $1,149,825. Homes worth more may benefit from proprietary reverse mortgages.
Mandatory Counseling
Before applying, you must complete HUD-approved counseling. This protects borrowers by ensuring they understand all terms and risks.
Non-Recourse Guarantee
You (or your heirs) will never owe more than your home is worth when sold, even if the loan balance exceeds the home value.
HECM Mortgage Insurance Premium (MIP) Explained
Upfront MIP
of appraised home value (or HECM limit, whichever is less). Typically financed into the loan.
Annual MIP
of outstanding loan balance per year, charged monthly. This adds up significantly over time.
What Does MIP Pay For?
- - Guarantees you receive your loan funds even if the lender fails
- - Covers the "non-recourse" protection (you never owe more than home value)
- - Pays the lender if your loan balance exceeds home value at sale
HECM vs Proprietary: Which Should You Choose?
Choose HECM If...
- Your home value is under $1,149,825
- You want FHA insurance protection
- You want the line of credit growth feature
- You prefer government-backed consumer protections
- You qualify for all FHA property requirements
Choose Proprietary If...
- Your home is worth over $1.5 million
- You want to avoid ongoing MIP charges
- Your property doesn't meet FHA requirements
- You want a faster closing process
- You own a high-rise condo or unique property
HECM Frequently Asked Questions
What is the HECM lending limit for 2024?▼
The 2024 HECM lending limit is $1,149,825. This is the maximum home value used to calculate your Principal Limit. If your home is worth more, only this amount is considered for a HECM - though you may benefit from a proprietary reverse mortgage instead.
How is the HECM Principal Limit calculated?▼
The Principal Limit = (Home Value or HECM Limit) x PLF. The Principal Limit Factor (PLF) is based on your age (or younger spouse's age) and current interest rates. Older borrowers get higher PLFs, meaning more available funds.
Can my spouse stay in the home if I pass away?▼
Yes, if your spouse is listed as a co-borrower or eligible non-borrowing spouse. They can remain in the home without making payments as long as they maintain property taxes, insurance, and upkeep. This is a key HECM protection.
What happens to my HECM if I need to move to a nursing home?▼
If you move out of your home for more than 12 consecutive months (including to a nursing facility), the loan becomes due. This is why planning for long-term care is important before getting a reverse mortgage.
Is HECM counseling really required?▼
Yes, HUD-approved counseling is mandatory before you can apply for a HECM. The counselor will explain costs, alternatives, and your obligations. This protects borrowers from making uninformed decisions.
Important Disclaimer
This calculator provides estimates for educational purposes only. Actual HECM terms, PLFs, and fees vary based on HUD guidelines, lender policies, and your specific situation. The HECM lending limit is updated annually. This is not financial advice. Consult a HUD-approved reverse mortgage counselor before applying.
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