You need to be at least 62 to get a reverse mortgage, and your age determines how much you can borrow. Younger borrowers get higher limits because lenders expect longer repayment periods. The loan accrues interest over time, so your equity shrinks instead of grows, and if you live past 100, interest can eat up most of what's left.
If you enter a reverse mortgage loan at age 62, which is the minimum age for the HECM program, and you live 20, 30 more years of life, where if you enter the reverse mortgage contract at, say, age 80, actuarial tables are shortening your life expectancy with that program. So the reverse mortgage has an interest rate, and you're going to accumulate interest over time. This makes it a rising debt type of loan. The rising debt, lower equity is what a reverse mortgage is compared to a traditional loan, which you're down the balance. So assuming you don't make any payments and you live to life expectancy, 100 years old, you could live beyond, there is a, a factor in that, that you're going to borrow more money over a longer lifetime. So therefore, in the beginning of the reverse mortgage at application, you're going to receive a certain loan-to-value or principal limit, which is based on the youngest borrower's age and current interest rates.
