"HECM for Purchase"
How to Purchase a New Home Directly with a Reverse Mortgage
Did you know that a new home can be purchased with a reverse mortgage?
Not many people realize that this is possible.
Also called a “HECM for Purchase”, this type of loan helps you accomplish two goals with a single transaction – buying a new home while securing a reverse mortgage.
Many seniors like you prefer this option, because it can help save money by reducing closing costs (since only a single loan is taken out). This can also make the homebuying process faster and easier for seniors like you.
“Crown Reverse Mortgage gave me a fair quote. It was honest, and matching (and even exceeding) other offers. Their service was excellent as well as the communication with the broker. Unfortunately, and this is not your fault, the closing department was very slow… Still, Crown Reverse Mortgage kept in touch and made me feel secure, so they deserve a 5-star rating.”
You can Buy a New Home Without Monthly Mortgage Payments!
It’s not too good to be true! A HECM for Purchase is just a reverse mortgage designed to help homeowners 62 and older buy the home they need, while meeting their financial and retirement goals.
If you qualify, you can use a HECM for Purchase reverse mortgage to relocate to a home that’s closer to your family. Would you prefer a home that’s more physically accessible? Or does your current home not fit your future needs? This is a great option for homeowners looking to downsize.
Of course, a HECM for Purchase reverse mortgage is still a loan, so interest does accrue on the portion of the loan amount disbursed. As with any home, the homeowner is responsible for paying for property taxes, insurance premiums, and necessary maintenance.
- If you qualify, you can buy a home or FHA approved condo as your principal residence by taking out a HECM reverse mortgage on that property.
- You simply use the proceeds from the sale of your current home, or cash on hand. You make a down payment (usually 40% to 50% of the cost of the new home) and cover closing costs.
- The balance of the purchase is covered by your HECM proceeds—any remaining funds can be used as you choose.
- There’s just a single closing, as the home purchase and HECM reverse mortgage are executed in one transaction.
- You make no monthly mortgage payments on the new home(1).
- You own the home—not the bank—and you can continue to live in it, as long as the terms of the loan are met.
- The loan is repaid(2), when the last surviving homeowner vacates the property for 12 months of the home or passes away.
If you are considering using a reverse mortgage to buy your retirement home, the next step is to use our free calculator to get an instant quote.
You will see all the options available to you, and can expect the following:
- You will receive a (no strings attached) call from a Crown Reverse Mortgage loan officer.
- We will discuss your financial situation and needs, in order to help you determine if a reverse mortgage is the right type of loan for you.
- If it is, we will proceed with the application process and begin working on your loan.
Want to learn more on how you can buy a house with reverse mortgage proceeds? Check out our article, here.
(1) You must continue to pay property taxes, insurance, and home maintenance.
(2) Including principal plus accrued fees and interest,