Reverse mortgage interest rates in the US can vary depending on a variety of factors, including the type of reverse mortgage you have, the lender you are working with, the current market conditions, and the borrower’s creditworthiness. In general, reverse mortgage interest rates are typically higher than traditional mortgage interest rates.
The most common type of reverse mortgage is the Home Equity Conversion Mortgage (HECM), which is insured by the Federal Housing Administration (FHA). HECM interest rates can vary, but they are generally tied to an index such as the London Interbank Offered Rate (LIBOR) or the Constant Maturity Treasury (CMT) rate, plus a margin that is set by the lender.
As of September 2021, the interest rate for HECMs ranged from approximately 2.85% to 5.95%, depending on the specific terms of the loan. However, it’s important to note that interest rates can change over time, so it’s important to check with your lender for the most up-to-date information. Additionally, borrowers must also pay an FHA insurance premium, which can add to the overall cost of the loan.