Find below the differences between the two types of Reverse Mortgage interest rate choices. The graphs show how the rates have changed over the past one year.

		Annually Adjusted Loan		Monthly Adjusted Loan
Interest Rate used to determing loan amounts		10-year Treasury rate (index) plus 2.1% (margin)		10-year Treasury rate (index) plus 1.5% (margin)
Net Principal Limit (Loan available to borrower at closing)		Smaller		Larger
Interest Rate on the Loan		Subject to change once per year; equals 1-year Treasury rate (index) plus 2.1% (margin)		Subject to change once per month; equals 1-year Treasury rate (index) plus 1.5% (margin)
Interest Rate Cap		2 points per year; 5 point over the life of the loan		No annual cap; 10 points over the life of the loan
Compounding Rate		Initial rate plus .5% for periodic mortgage insurance premium (MIP)		Initial rate plus .5% for periodic mortgage insurance premium (MIP)
Monthly creditline growth		Larger		Smaller