Reverse Mortgage Calculator
Convert your home equity into a regular monthly pension. Calculate your eligible loan amount and monthly payouts without having to sell your house.
Note: The bank pays you the monthly pension. The interest is added to your loan balance. You do not make any monthly EMI payments to the bank.
Monthly Pension
Received every month for 15 years
Max Eligible Loan Amount
(60% of Property Value)
Final Loan Breakdown
Outstanding Balance Over Time
Understanding Reverse Mortgages
How it Works
A reverse mortgage is the opposite of a traditional home loan. Instead of you paying the bank an EMI to buy a house, the bank pays you a monthly amount against the equity of the house you already own. The loan amount, along with accumulated interest, becomes due only when the last surviving borrower dies or permanently moves out.
The "Non-Recourse" Guarantee
Reverse mortgages in India are typically "non-recourse" loans. This means that if the total outstanding loan (principal + interest) exceeds the value of the property when it is finally sold, the bank absorbs the loss. They cannot ask your legal heirs to pay the difference from their own pockets.
Why is the Monthly Pension Low?
You might notice that a ₹1 Crore house only yields a monthly pension of around ₹10,000 to ₹15,000. This is because of the power of compound interest working against you. The bank must ensure that the total money disbursed, plus the massive amount of interest that will compound over 15-20 years, does not exceed the maximum eligible loan amount (e.g., ₹60 Lakhs).
Tax Implications
Under Section 10(43) of the Income Tax Act, 1961, the monthly payments you receive from a reverse mortgage are considered a loan disbursement, not income. Therefore, these payments are completely tax-free in the hands of the senior citizen.
Frequently Asked Questions
What is a Reverse Mortgage?
A reverse mortgage is a financial product designed for senior citizens who own a house but lack a regular income stream. It allows them to pledge their property to a bank in exchange for regular monthly payments (like a pension), a lump sum, or a line of credit. Unlike a regular mortgage where you pay the bank, in a reverse mortgage, the bank pays you.
Who is eligible for a Reverse Mortgage in India?
Typically, the applicant must be a senior citizen (at least 60 years old). If applying jointly with a spouse, the spouse must be at least 55 years old. The property must be self-acquired, self-occupied, and free of any encumbrances (no existing loans on it).
Do I have to vacate the house?
No. The biggest advantage of a reverse mortgage is that you and your spouse can continue to live in the house for your entire lifetime, even after the loan tenure ends and the bank stops making monthly payments.
What happens after the loan tenure ends?
If the tenure is 15 years, the bank will stop making monthly payments after 15 years. However, you are not required to repay the loan or vacate the house as long as you or your spouse are alive. The outstanding loan balance will continue to accrue interest.
How is the loan repaid?
The loan becomes due only after the death of the last surviving borrower or if they permanently move out. At that point, the legal heirs have the option to repay the loan (principal + accumulated interest) and keep the house. If they choose not to, the bank will sell the house, recover its dues, and pass on any remaining surplus to the legal heirs. The bank cannot demand more than the sale value of the house, even if the loan amount exceeds it (non-recourse loan).