How It Works
With a reverse mortgage loan for purchase (also called HECM for purchase loan), you apply those loan proceeds to the price of a house you want to buy. You can use the equity from the home you are leaving or other funds to cover any leftover balance.
This can increase your purchasing power tremendously because it adds the funds from a reverse mortgage loan on top of the other assets that you already have—that includes the proceeds from the sale of your current home.
Then What Happens?
You enjoy the same terms for any home with a reverse mortgage loan:
Never have to make monthly mortgage payments unless they want to
The home is theirs, in their name, and no one can make them leave
Simply pay homeowner’s insurance, property taxes, and maintain the home
Who’s a Great Fit for a Reverse for Purchase Loan?
The following are just a couple examples of people who find the living situation that’s best for their golden years.
Moving to the Perfect Neighborhood
NOTE: Story is for illustration purposes only. The persons depicted herein are fictional and any resemblance to actual persons is a coincidence.
James and Mary, who are 62 and 59, want to move to a newly constructed home in an area that’s ideal for retirees. The problem is that home values are close to double in the new community compared to where they live currently. With a reverse mortgage for purchase, James and Mary can make their move and never have to make monthly mortgage payments again. They just need to pay taxes, insurance, and maintain the home.
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$600,000 Home Sale Value
James and Mary currently own this home.
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$800,000 Home Value
With a reverse mortgage for purchase, the proceeds from their old home would enable them to buy their much more expensive dream home—free of monthly mortgage payments. They just need to pay taxes, insurance, and maintain the home.
Planning for a Legacy**
NOTE: Story is for illustration purposes only. The persons depicted herein are fictional and any resemblance to actual persons is a coincidence.
Cindy, who is 62, is selling her current home that is owned free and clear. She wants a home of a similar value that is closer to her grandchildren—but she also wants to set up an annuity for her grandchildren to help pay for college. A reverse mortgage can allow her to purchase the home she wants and have plenty of money left over from the sale of her current house.
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$800,000 Home Sale Value
Cindy currently owns this home.
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$650,000 Home Value
With a reverse mortgage for purchase, Cindy could sell her current house, buy a $650,000 house, and have $170,000 to spend on an annuity for her grandkids. She would also never have to make monthly mortgage payments again. She just needs to pay taxes, insurance, and maintain the home.
What About Your Specific Situation?
Our loan officers can explain the most beneficial option for your unique needs.
Our Video Series for Homeowners
Learn what you need to know about reverse mortgages.
Buying a New Home with A Reverse Mortgage (HECM) for Purchase
How Much Money Can I Get from my Home?
Do I Want a Reverse Mortgage Loan? Things to Think About…
Curious About What You May Qualify For?
Fill out this super short form to see your potential reverse mortgage proceeds!
*The required down payment on your new home is determined on a number of factors, including your age (or eligible non-borrowing spouse’s age, if applicable); current interest rates; and the lesser of the home’s appraised value or purchase price.
**This advertisement does not constitute tax or financial advice. Please consult your tax and/or financial advisor for your specific situation.