Let's take a look at what the definition of a reverse mortgage is before talking about what a reverse mortgage calculator does. Reverse mortgage is what banks can offer to their clients above the age of 60 who would like to borrow money against the value of their property. When the property is sold at a future date in time, that is when this type of mortgage needs to be settled. This type of mortgage is what a person that is over the age 60 starts to consider to help with financial during their retirement years.

A reverse mortgage is totally different then a regular mortgage. Rather then the loan decreasing as you make payments, interest is applied so your debt is increasing. Since you need not make repayments, when you reach the end of the mortgage and the interest is incurred, the debt will grow over the time that you have taken the mortgage out for.

A reverse mortgage calculator will help you to determine whether or not it a smart option for you to go with a reverse mortgage. The current value of your property is very important in calculating whether this is a wise option for you. Another important factor is the payoff amount on the mortgage you currently have and other liens you have against your property.

You need to decide how much money you will require and the manner in which you receive it. Do you need a cash lump sum, monthly payments, or a line of credit? Another option is to use all three alternatives. Once all these questions have been answered and input, the reverse mortgage calculator can process the information and give you some ideas as to what type of reverse mortgage you will require.

Now it is up to you to seek out the best lender that will provide the terms and conditions that suite your situation. Always beware of lenders that do not have good reputations therefore it is a good idea to seek well known and trusted lenders to do business with.