Reverse mortgage payment calculator

Example

CNY 5,000/month · 30 years · 3.5%

Affordable principal and total interest

Rate solving also requires the known principal.

Technical details & limits

Principal uses the present value of an annuity. Rate uses binary search over 0–100% annual interest. Both assume equal payment.

About this tool

Solve for affordable principal from payment, term and rate, or infer a rate from principal, term and payment.

Use cases

• Work backwards from an affordable payment to a principal.
• Given a principal, find the term that brings the payment down to a target.
• Compare rates when the payment ceiling is fixed.

How to use

1. Pick what to solve for: the principal or the term.
2. Enter the affordable payment, the annual rate and the other known figure.
3. The result gives the solved figure along with total interest and total repaid.

Notes

A principal derived from a payment and a rate is arithmetic, not an approval. Lenders also weigh income, existing debt, credit history and the property valuation.

FAQ

How can a monthly payment budget be converted into a loan principal?

This tool converts a payment budget into principal using the present value of equal monthly payments, given an annual rate and term. A 20-year term becomes 240 periods, and the annual rate is divided by 12 for the monthly calculation. The result is a mathematical amount under those assumptions. It excludes approval criteria and additional charges, so it is not a lender's commitment to provide that amount.

What annual rate range does reverse mortgage rate calculation search?

The reverse-rate solver searches annual rates from 0% through 100% using bisection within an equal-payment model. If the payment cannot cover principal divided by the number of periods, there is no nonnegative rate solution in that range. Review the input units and term before retrying. A solved rate explains the entered payment relationship; it does not represent a quoted lending rate or automatically include other financing charges.

How is loan principal calculated when the interest rate is zero?

At an annual rate of 0, principal equals the monthly payment multiplied by the number of periods. A payment of 2000 over 120 periods corresponds to principal of 240000. This arithmetic excludes additional charges and assumes the stated payment schedule. If the contract includes handling fees or other costs, a zero nominal rate does not imply zero financing cost, and those cash flows need to be considered separately.

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