Reverse Mortgage Template (What can I afford?)

Calculations

# REVERSE MORTAGE: What can I afford?
# Calculate maximum home price based on a target monthly budget.

# PARAMS (Inputs)
maxMonthlyBudget = 1500 $/ month
downPaymentPercent = 20 %

annualInterestRate = 4.5 %
loanTerm = 30 years


# Constants & Prep
r = annualInterestRate / 12
totalPayments = loanTerm to months
n = totalPayments / (1 month)

# Reverse Amortization Formula to find Max Loan Amount
# L = P * [ ((1+r)^n - 1) / (r(1+r)^n) ]
maxLoanAmount = maxMonthlyBudget * ((1 + r)^n - 1) / (r * (1 + r)^n) * (1 month)

# Calculate the maximum home price you can target
# Since loan = homePrice * (1 - downPayment), then homePrice = loan / (1 - downPayment)
maxHomePrice = maxLoanAmount / (100 % - downPaymentPercent) to $
requiredDownPayment = maxHomePrice * downPaymentPercent to $

# Output Summary
maxHomePrice
maxLoanAmount
requiredDownPayment