Reverse mortgage for purchase
You’ve worked hard to get to this point. Now you’d like to live in a “right-sized” home that fits your needs today and get comfort and financial peace of mind for the future. Perhaps you want to move to a home that’s closer to family, more maintenance-free, or in a more social neighborhood. But maybe you don’t think you can afford to move because of your financial obligations, income, or other issues. Fortunately, there’s an established financing option for homebuyers who are 62 and older that can help you get the funds you need to buy the home you want.
What is a reverse mortgage for purchase?
This Federal Housing Administration (FHA)-insured || home financing program is designed specifically for homebuyers who are 62 and older. It’s specifically designed to help you get the funds you need to buy the home you want at this point in your life — with fewer financial worries and limitations.
Single-family homes, townhomes, and FHA-approved || condominiums are eligible as long as you use the home as a primary residence.
How does it work?
You can purchase a home by combining a one-time investment of your own funds (your down payment) with loan proceeds from a reverse mortgage to complete the transaction. As with a traditional “forward” mortgage, the home you are purchasing secures the loan.
However, unlike a traditional mortgage, there are no monthly mortgage payments, which can help boost your cash flow. You own the home as long as you live in it. The loan does not have to be repaid until you sell the home or no longer live there as your primary residence. In order for the loan to remain in good standing, you must meet certain home ownership obligations — which include maintaining the property and keeping current with property-related taxes and insurance payments.
Comparing your options to purchase a new home:
- You own the home free and clear
- Option to make a minimum down payment and limit up-front investment
- Builds equity as you pay down the loan
Reverse mortgage for Purchase
- Flexible payment feature: Monthly principle and interest payments are optional*
- Can give you the ability to buy the home you really want
- Allows you to keep more assets and can increase cash flow
*As with any mortgage, you must meet your loan obligations, keeping current with property taxes, insurance and maintenance.