Reverse Mortgage Calculator

Important notice: All computations are for illustrative purposes and do not constitute advice or a guarantee of a loan approval.

Understanding How A Reverse Mortgage Works

Using the equity in your home as security to access cash flow is an option for Australians over 60 who own their home.  Equity is the value of your home.  Taking out a reverse mortgage is when you mortgage a portion of that equity back to the bank in exchange for cash flow.

The cash flow could be a lump sum, a line of credit or an income stream.  It could also be a combination of these three options.  The amount you can borrow depends on your age and is not usually more than 25% of the equity.

With the reverse mortgage, instead of making regular payments to pay back the mortgage, the loan is paid out when:

• You sell or move out of your home
• Your deceased estate sells your home

As you’ll see with the reverse mortgage calculator above, the amount to be paid back to the lender changes over time.  Similarly, the amount of equity you own in your property reduces over the length of your loan.

Taking out a Reverse Mortgage can be a great strategy.  However, it is one that we recommend you understand clearly.  That’s why we recommend you chatting to one of our MFAA-accredited mortgage brokers who specialise in this field.  You can book your appointment by calling 1300 881 220 or selecting an appointment below: