Reverse Mortgage Calculator

A reverse home loan calculator for Australians aged 60 and over. Use it as a reverse loan calculator to estimate what you could draw against your home, and what the debt grows to over time. Read the section on compounding before you read the number, because that is the part that decides whether this suits you.

The official projection is not this one

This calculator gives you an estimate. It is not the projection the law requires.

Before a credit assessment is made, a lender or broker has to show you projections of what a reverse mortgage would do to the equity in your home, calculated on a website approved by ASIC, and give you a copy. They also have to give you a document called Key Information About Reverse Mortgages.

You can run those official projections yourself, for free and without giving anyone your details, using the reverse mortgage calculator on ASIC’s Moneysmart site. If you are searching for the ASIC reverse mortgage calculator, that link is it. We would rather send you there than pretend our estimate replaces it.

Want to talk it through with a person?

There is no pressure and no obligation. A conversation costs nothing, and for a decision this size it is worth having one before you go any further.
No fee from us for arranging your finance. No obligation.

What a reverse mortgage is, and what protects you

A reverse mortgage lets you borrow against a home you already own, without selling it and without making regular repayments. The interest is added to the balance instead of being paid, and the whole amount is repaid when the last borrower permanently leaves the home, whether that is through sale, moving into aged care, or the estate being settled.

Because you make no repayments, the balance only ever goes one way. That is the central fact about the product and everything else follows from it.

Australian law puts specific protections around these loans, which were strengthened in 2012.

No negative equity guarantee

By law a lender cannot require or accept repayment of more than the market value of the property. You, and your estate, cannot end up owing more than the home is worth. This is statutory, not a feature one lender offers and another does not.

You cannot be asked to leave

The loan does not have to be repaid until the last borrower permanently leaves the home. The lender cannot ask for payment before that, provided you meet the loan obligations such as keeping rates and insurance paid.

Projections must be shown to you

Before a credit assessment, a lender or broker must show you what the loan would do to your equity over time, calculated on an ASIC approved website, and give you a copy to keep.

Independent advice

ASIC expects borrowers to get independent legal advice on the loan terms. Take it. This is not a document to sign on the strength of a conversation.

What compounding actually does

This is the section to read twice. A reverse mortgage is not expensive because the rate is high. It is expensive because nothing is repaid, so the interest earns interest for as long as you live in the home.
Illustrative only. Not a rate offer, a quote, or a forecast. Rates vary by lender and move over time.

Take $150,000 drawn at an assumed 8.50 per cent, with no repayments made.

After 5 years the balance is about $225,500.
After 10 years, about $339,100.
After 15 years, about $510,000.
After 20 years, about $766,800.

The single most useful way to hold this in your head is the doubling time. At 8.50 per cent the debt doubles roughly every 8.5 years. At 9.05 per cent it doubles every 8 years. Someone who borrows at 60 and lives in the home until 85 has been through that doubling nearly three times.
Whether that is a problem depends entirely on what you want the home to do afterwards. If the plan is to live there for life and the estate is not the priority, a growing balance may be perfectly acceptable, and the no negative equity guarantee means it cannot exceed the value of the house. If leaving the home to someone matters, or if it may need to fund aged care later, the compounding is the whole question.

Property values usually rise too, which softens the picture. On a $900,000 home growing at an assumed 3 per cent a year, with $150,000 drawn at 8.50 per cent, the remaining equity is roughly 72 per cent of the home’s value after 10 years and 53 per cent after 20. The debt grows faster than the house, so the share left to you shrinks over time even while the dollar figure holds up.

Check the government scheme first

Most pages about reverse mortgages do not mention this, and there is an obvious reason why. We are mentioning it because a broker in Australia owes you a best interests duty, and it would be difficult to argue we had met it while staying quiet about a materially cheaper option.
The Australian Government runs the Home Equity Access Scheme. It works on the same principle, a loan secured against your home, repaid when the home is sold or from the estate, with a no negative equity guarantee.

The difference is the rate. The government scheme has been running at around 3.95 per cent, against roughly 7.85 to 9.05 per cent for commercial reverse mortgages as at mid 2026.

Put that through the doubling time. At 3.95 per cent the debt doubles about every 17.9 years. At 8.50 per cent, every 8.5 years.

On $150,000 left to compound for 20 years, that is roughly $325,500 against $766,800. A difference of over $441,000 in what comes out of your home.
It is not better for everyone. The scheme is more restrictive: approval takes longer, lump sum access is capped, and there is no line of credit. A commercial reverse mortgage gives you more flexibility and faster access, and for some situations that is worth paying for.

But it should be a comparison you make deliberately, with both numbers in front of you. Around 19,400 people were using the government scheme in early 2026, against a commercial reverse mortgage market of roughly $5.5 billion. That gap is not because the scheme suits almost nobody. It is because almost nobody hears about it.

Start at Services Australia. If it does not fit, come back and we will look at the commercial options properly.

How much you could borrow

Two things decide it: the age of the youngest borrower, and the value of the home. Older borrowers can access more, because the expected term of the loan is shorter and there is less time for the balance to compound.

As a rough industry pattern, borrowing capacity starts around 15 to 20 per cent of the property value at age 60 and rises by roughly one percentage point for each year of age. On a $900,000 home that is very approximately $135,000 to $180,000 at 60, and $270,000 to $315,000 at 75. Every lender applies its own table, so treat that as the shape rather than the answer.

ASIC also sets limits under the credit legislation, and in April 2026 introduced a cap on the maximum loan to value ratio for the oldest borrowers. Your lender will confirm what applies to your age and property.

One note for anyone who arrived searching for a HECM calculator: HECM is a United States product and does not exist in Australia. The Australian equivalent is a reverse mortgage regulated under the National Consumer Credit Protection Act, and the protections are different.

What else it touches

A reverse mortgage does not sit on its own. It reaches into several other things at once, and each of them is worth checking with the right person before you commit.

Your pension

Money drawn from a reverse mortgage can affect Age Pension entitlements depending on how much you take and what you do with it. Services Australia or a financial counsellor can tell you how it would apply to your circumstances. This is not something to work out from a calculator.

Aged care

If you may need residential aged care later, the equity remaining in your home is often part of how that is paid for. A balance that has been compounding for fifteen years changes what is available. Worth thinking about now rather than then.

Your estate

What is left of the home after the loan is repaid is what passes on. If that matters to you or to your family, have the conversation with them before signing rather than leaving it to be discovered later.

A surviving partner

Make sure both partners are borrowers on the loan, not just one. If only one is named and that person dies or moves into care, the loan can become repayable while the other is still living there. Ask this question explicitly.

Things worth considering first

A reverse mortgage is one way to solve a cash flow problem in retirement, and it is rarely the only one. Before deciding, it is worth at least considering:

The Home Equity Access Scheme, covered above, which is usually much cheaper.

Downsizing. Selling and buying something smaller releases equity outright with no compounding debt. South Australia has stamp duty relief for eligible downsizers, which changes that arithmetic.

Home reversion. Selling a share of the home now rather than borrowing against it. A different structure with different risks.

A conventional loan, if there is income to service it. Much cheaper than letting interest compound, if servicing is possible.

Free financial counselling. The National Debt Helpline on 1800 007 007 is free, independent and has no product to sell. If money is tight, start there rather than with any lender.
Related tools: loan repayment calculator if you are comparing against a conventional loan, and the comparison rate calculator.

If a conventional home loan or a refinance would suit you better, see refinancing or buying a home.
Sources
Australian Government, ASIC Moneysmart: Reverse mortgage and home equity release and the reverse mortgage calculator, which is the ASIC approved tool for the projections the law requires.
Australian Government, Services Australia: Home Equity Access Scheme.
Commonwealth of Australia: the National Consumer Credit Protection Act 2009, which contains the no negative equity guarantee and the disclosure obligations that apply to reverse mortgages.

About the figures on this page. Every balance, doubling time and equity figure was calculated directly from standard compound interest, not taken from a third party. The rates used are illustrative and reflect the range reported in the Australian market during 2026. They are not an offer, a quote or a forecast, and reverse mortgage rates move.

General information only. Nothing on this page takes your objectives, financial situation or needs into account. A reverse mortgage is a long term commitment with consequences for your pension, your aged care options and your estate, and it deserves independent legal and financial advice before you proceed. Loanity is a credit representative and can provide credit assistance once we understand your circumstances.
STILL GOT QUESTIONS?

Reverse mortgage questions, answered

How do I calculate a reverse mortgage?

To calculate reverse mortgage figures, two calculations matter. The first is how much you could draw, which depends on the age of the youngest borrower and the value of the home. The second, and the more important one, is what the balance grows to, because no repayments are made and the interest compounds. Use the estimate above for a rough idea, then run the official projection on ASIC’s Moneysmart reverse mortgage calculator, which is the tool the law recognises.

On the Moneysmart website, which ASIC runs. It is linked near the top of this page. If you searched for a home loan reverse calculator or a mortgage calculator reverse and landed here, that Moneysmart link is the one you want. If you searched for a home loan reverse calculator or a mortgage calculator reverse and landed here, that Moneysmart link is the one you want. Before a credit assessment is made, a lender or broker must show you projections calculated on an ASIC approved website and give you a copy, so that tool is not optional extra reading, it is part of the process.

No. Australian law prohibits a lender from requiring or accepting repayment of more than the market value of the property. That is the no negative equity guarantee, and it has been statutory since 2012. It applies whether or not a particular lender advertises it as a feature.

It depends on your age and the value of your home, and older borrowers can access more. As a rough pattern, capacity starts around 15 to 20 per cent of property value at age 60 and rises by roughly a percentage point per year of age. Every lender has its own table and ASIC sets limits under the credit legislation, so treat that as the shape rather than a promise.

Faster than most people expect, because nothing is repaid. The useful figure is the doubling time. At around 8.5 per cent the balance doubles roughly every 8.5 years. Someone who borrows at 60 and stays until 85 has been through that nearly three times. On $150,000 drawn at that rate, the balance after 20 years is around $766,800.

Usually yes, and by a wide margin. The government scheme has been running at around 3.95 per cent against roughly 7.85 to 9.05 per cent for commercial products in 2026. Over 20 years on $150,000, the difference in the balance is more than $441,000. The scheme is more restrictive on how much you can take and how quickly, so it does not suit everyone, but it is worth checking before anything else.

No, and that is the defining feature. You can make voluntary repayments with most lenders if you want to slow the compounding, and doing so makes a substantial difference over a long period. But nothing is required until the last borrower permanently leaves the home.

The loan generally becomes repayable when the last borrower permanently leaves the home, and moving into residential aged care usually counts. That matters because the equity in the home is often part of how aged care is funded, so it is worth understanding how the two interact before you take the loan rather than at the point of needing care.

It can, depending on how much you draw and what you do with it. Money sitting in a bank account is treated differently from money spent on a home repair. Services Australia can tell you how it would apply to your situation, and a free financial counsellor can help you think it through without selling you anything.

HECM stands for Home Equity Conversion Mortgage, which is a United States product backed by the US government. It does not exist in Australia. The Australian equivalent is a reverse mortgage regulated under the National Consumer Credit Protection Act, with its own protections including the no negative equity guarantee. If you have been reading American material, the rules there do not carry across.