Reverse mortgages may have fixed or variable rates. Most have variable rates that are tied to a financial index and will likely change according to market conditions.
When a HECM loan is paid to the borrower in a monthly fixed amount, the interest rate is adjustable monthly. The initial interest rate is based on the one year Treasury Bill + a 1% margin (recently reduced from 1.5%), with a loan lifetime cap of 10%. If the loan adjusts annually, the initial interest rate is the weekly average of the 1 year Treasury Bill + a 3.10% margin. There is a 2% annual cap, and a 5% lifetime cap.
Since the interest rates of Reverse Mortgages are based on the relatively stable Treasury Bill, the average interest rate in last 25 years under either formulation is about 7%.