Reverse mortgage credit line growth is a bonus that comes with the loan. Currently as of May 2022 reverse mortgage credit lines with available credit not used yet, have growth rates attached to them. This means each month the available credit left to use on the credit line grows each month which translates into additional funds for you to use in the future. You don’t have to anything for this to happen. Left unused for a long period of time, the available credit to use grows like a weed and makes the reverse mortgage line of credit an attractive option. I made a video that explains the available credit HECM growth rate that shows an example and an amortization table.
It is important to note that there are a few different reverse mortgage line of credit options available and each grows at different rates and for varying lengths of time. The FHA HECM reverse mortgage line of credit currently has a higher available credit line growth rate and can stay open to use the rest of your life, the other non-HECM reverse mortgage credit lines available have lower available credit growth rates and allow growth for the first seven years, and get frozen after 10 years.
I’ve attached a video I created that shows spreadsheets over several spans of time for both types of reverse mortgage credit lines, HECM and non-HECM, so you can see how each available credit line grows based off of their individual guidelines, as they are different.
Please let me know your scenario below and I can run some numbers for you and create a amortization table as shown in the video.
Kind regards,
KW