Florida Reverse Mortgage / HECM Calculator

How this calculator works

A Home Equity Conversion Mortgage (HECM) is the federally-insured reverse mortgage available to homeowners age 62 and older under 12 U.S.C. § 1715z-20 and 24 CFR Part 206. Florida is the number-two state in the country for HECM originations, behind only California, driven by the homestead-protected, retiree-heavy, equity-rich profile of the typical Florida senior homeowner. The HECM lets that homeowner tap home equity without making monthly principal-and-interest payments — interest accrues into the balance and the loan only becomes due upon a maturity event (death, sale, or failure to occupy the home as a primary residence).

This calculator surfaces every piece of the HECM math a Florida borrower needs to evaluate the option before sitting down with a HUD-approved counselor:

1. Maximum HECM principal limit — the most a borrower can ever access, set by HUD's Principal Limit Factor (PLF) lookup against the age of the youngest borrower and the expected interest rate.
2. Available cash at closing after the federal HECM closing-cost stack (2% Initial MIP, capped origination, counseling, third-party costs), the Florida-specific layer (mortgage stamps and intangible tax), and any existing-mortgage payoff.
3. Monthly tenure payment if the borrower elects the life-contingent annuity option.
4. Line of credit with growth — the projected line size at years 5, 10, and 20 if the borrower elects the LOC option.
5. Projected outstanding balance at years 10 and 20 if the borrower draws the full available cash at closing.

The PLF lookup: age, rate, and the borrowing capacity

HUD publishes the Principal Limit Factor tables in each annual Mortgagee Letter. The PLF is indexed by two variables: the age of the youngest borrower on title and the expected interest rate at application. Older borrowers get a higher PLF (because the actuarial expected loan duration is shorter). Lower expected rates also raise the PLF (because future interest accrual is lower, leaving more room under the home value).

The PLF table embedded in this calculator is a simplified version at the canonical 6% expected-rate anchor, with linear interpolation between 5-year age bands. A rough sense of the shape:

• Age 62: PLF ~0.41 (the youngest eligible borrower)
• Age 70: PLF ~0.50
• Age 80: PLF ~0.60
• Age 90: PLF ~0.72
• Age 95+: PLF plateaus near 0.75

For a Florida couple where one spouse is 75 and the other is 65, HUD uses age 65 to look up the PLF — the younger of the two ages. That single fact often surprises first-time HECM applicants and is the single largest reason a 70-year-old single borrower has more HECM capacity than a 75-year-old married couple with a 65-year-old spouse on the same Florida home.

The Florida closing-cost stack

A HECM in Florida carries the standard federal HECM closing-cost layer plus the Florida-specific transactional-tax layer. Both apply to the max claim amount — the lesser of home value and the HUD HECM national lending limit of $1,209,750 for 2025.

Federal HECM layer:

• Initial Mortgage Insurance Premium (IMIP) — 2% of max claim amount, paid at closing. On a $400,000 home: $8,000.
• Origination fee under 24 CFR § 206.31: 2% on the first $200,000 of max claim amount plus 1% above, with a statutory floor of $2,500 and ceiling of $6,000. On a $400,000 home: $4,000 plus $2,000 equals $6,000 — at the cap.
• Counseling fee — Florida-typical $125-$200 for the HUD-approved counselor session required under 24 CFR § 206.41.
• Third-party closing costs — appraisal, title insurance lender's policy, recording, flood certification, courier. Florida-typical $3,500-$5,500.

Florida statutory layer:

• Mortgage documentary stamps (F.S. § 201.08) — $0.35 per $100 of max claim amount, paid at closing. On a $400,000 max claim: $1,400.
• Non-recurring intangible tax (F.S. § 199.133) — 2 mills per dollar of max claim amount. On a $400,000 max claim: $800.

A common pattern with out-of-state HECM lenders is to quote the federal layer accurately and miss the Florida statutory layer entirely. On a typical Florida HECM, the Florida layer adds $2,000-$6,500 of closing cost depending on home value. The calculator above surfaces it explicitly.

Worked example: 70-year-old, $400,000 Florida home, no existing mortgage

A Florida homeowner age 70 owns a $400,000 home outright (no existing mortgage) and is considering a HECM at a 6.0% expected rate.

Principal limit:

• Max claim amount: $400,000 (under the $1,209,750 HUD cap)
• PLF at age 70 / 6.0%: 0.50
• Maximum principal limit: $400,000 times 0.50 equals $200,000

Closing-cost stack:

• IMIP (2% of $400,000): $8,000
• Origination fee (capped): $6,000
• Florida mortgage stamps: $1,400
• Florida intangible tax: $800
• Counseling + other closing costs: $4,675
• Total HECM closing costs: $20,875

Service fee set-aside (withheld from principal limit for HUD-required monthly servicing reserves): $3,000

Available cash at closing:

• Principal limit $200,000 minus closing costs $20,875 minus existing mortgage payoff $0 minus service fee set-aside $3,000 equals $176,125

Monthly tenure payment (if elected): roughly $1,113 per month for life as long as the borrower lives in the home, using HUD's (100 minus age) horizon convention at the 6% expected rate plus the 0.5% annual MIP.

Line of credit with growth (if elected): the initial $176,125 line grows at 6.5% combined (note rate plus MIP), compounded monthly, to:

• Year 5: ~$244,000
• Year 10: ~$337,000
• Year 20: ~$644,000

That growth-feature math is the single most underappreciated piece of the HECM toolkit. A Florida retiree who establishes a HECM line of credit at 70 and never draws on it has accessible credit of roughly $644,000 by age 90 — against a home that may itself be worth meaningfully more by then. The line is non-cancellable as long as the borrower stays current on property charges, unlike a conventional HELOC which can be frozen by the lender in a credit-tightening cycle.

The Florida homestead nuance

The Florida homestead protection under Article X § 4 of the Florida Constitution shields the home from forced sale by creditors except for three carve-outs: consensual mortgages on the homestead, tax liens, and labor or material liens for improvements. A HECM is a consensual mortgage, so it sits inside the carve-out — the lender could foreclose on a HECM in default.

But — and this is the Florida-specific point that matters — a HECM is structured so that non-payment cannot trigger default. There are no required monthly principal-and-interest payments. The only HECM default triggers under 24 CFR Part 206 are:

1. The borrower stops occupying the home as a primary residence for 12+ consecutive months
2. The borrower fails to maintain the property
3. The borrower fails to pay property taxes, homeowners insurance, or HOA dues
4. The borrower dies (and there is no non-borrowing spouse continuing to occupy under § 206.45)
5. The borrower sells or transfers title

As long as the Florida borrower keeps current on the property charges and continues to occupy the home, the HECM cannot default — and therefore the homestead protection remains meaningfully intact in practice. The deferred-payment structure of the HECM is what makes it the right equity-tap tool for a homestead-protected Florida retiree, and the wrong tool to compare directly against a HELOC that can default for non-payment.

Choosing among the four payment options

Lump sum, tenure, line of credit, or hybrid. Each shape answers a different cash need:

Lump sum at closing — fixed-rate HECM only. Pays the full available cash on day one. Most expensive option in lifetime interest cost because the entire balance starts accruing immediately. Right answer when there is a specific large one-time use (paying off a 7% existing mortgage to eliminate the monthly payment, funding a major home modification, paying down high-interest credit-card debt). Even then, putting the equivalent amount into the LOC and drawing it on day one usually wins, because the undrawn portion of an LOC keeps growing.

Tenure — life-contingent monthly annuity. Pays a fixed monthly amount for as long as the borrower lives in the home. Right answer when the borrower wants income certainty and is willing to lock in a fixed monthly check. On the worked example above, $1,113 per month for life.

Line of credit with growth — the most powerful and underused option. The borrower establishes the line at closing, draws as needed, and lets the unused portion grow at the note rate plus 0.5% MIP. Non-cancellable as long as the borrower stays current on property charges. The right default option for most Florida retirees because of the long-duration optionality.

Hybrid — mix and match. A common Florida structure: take a lump sum at closing to pay off an existing mortgage, then put the remainder into an LOC for future needs. The HUD-approved counselor will walk through the trade-offs at the counseling session under 24 CFR § 206.41.

What this calculator does not do

Several pieces of the Florida HECM picture sit outside the math here. We use a simplified PLF lookup table around the 6% anchor; the lender will run the current HUD PLF against your exact age and expected rate. We do not model the HECM Life Expectancy Set-Aside (LESA) that HUD's financial assessment under 24 CFR § 206.125 can carve out of the principal limit to cover future property taxes and insurance for borrowers with weaker residual income or credit. We surface the non-borrowing-spouse issue in the FAQ but do not produce the paperwork. We project the HECM balance forward at the note rate plus MIP but do not model how heirs would actually clear the loan from sale proceeds at maturity. We do not model the interaction with Medicaid eligibility — HECM proceeds held in cash for more than one month can affect Medicaid and SSI counts, and a Florida-licensed elder-law attorney should be consulted before drawing.

For binding numbers, the lender will produce a HECM Loan Estimate and a HUD-1 Settlement Statement. For the option-election decision, the HUD-approved counselor is the right resource. For the broader financial-planning question of whether a HECM is the right tool, consult a Florida-licensed fiduciary financial planner. For the homestead and elder-law overlay, consult a Florida-licensed attorney.

How this page is maintained

The Florida statutory rates surfaced here — F.S. § 201.08 mortgage stamps at $0.35/$100 and F.S. § 199.133 intangible tax at 2 mills — have been stable across recent Florida legislative sessions. The HUD HECM lending limit is set annually by Mortgagee Letter and currently sits at $1,209,750 for 2025. The HECM PLF tables are updated by HUD as actuarial assumptions and interest-rate expectations shift; we refresh the embedded table after each annual Mortgagee Letter.

Last reviewed: 2026-05-15 against 24 CFR Part 206, 12 U.S.C. § 1715z-20, HUD HECM Mortgagee Letter PLF tables, F.S. § 201.08, F.S. § 199.133, and Florida Constitution Art. X § 4.