About the Reverse Mortgage Calculator
What is the Reverse Mortgage Calculator?
A reverse mortgage lets homeowners aged 60 and above turn their house into a monthly income while continuing to live in it. The bank pays you each month; interest accumulates, and the loan is settled when the home is sold after the borrower's lifetime or the heirs repay it.
The payout is set so that all payments plus interest grow to the loan limit (a share of the property value) by the end of the period.
How to use the Reverse Mortgage Calculator
- Current Property Value (₹) (sample: 1,00,00,000)
- Loan Limit (% of property value) (sample: 60)
- Interest Rate (% per year) (sample: 9.5)
- Payout Period (years) (sample: 15)
- Press Calculate Reverse Mortgage Income (results also refresh as you type). The result card shows the Monthly Payout, along with Loan limit, Total paid out to you, Interest accumulated by the end and Tax.
Formula used
Monthly payout = Loan limit × i ÷ ((1 + i)ⁿ − 1)
- Loan limit = property value × lending percentage
- i, n = monthly rate and number of monthly payouts
Payouts are exempt from income tax under Section 10(43).
Worked example
These are the sample values already filled in the calculator above, and the result it returns for them:
| Input | Sample value |
|---|---|
| Current Property Value (₹) | 1,00,00,000 |
| Loan Limit (% of property value) | 60 |
| Interest Rate (% per year) | 9.5 |
| Payout Period (years) | 15 |
| Result | Value |
|---|---|
| Monthly Payout | ₹15,153 |
| Loan limit | ₹60,00,000 |
| Total paid out to you | ₹27,27,627 |
| Interest accumulated by the end | ₹32,72,373 |
| Tax | Reverse-mortgage payouts are exempt from income tax (Section 10(43)) |
Tips for using the Reverse Mortgage Calculator
- Banks revalue the property every few years and may revise the payout.
- Heirs can keep the house by repaying the loan with interest.
- Compare with renting out part of the home or downsizing, which may give more income.