Many people are aware of reverse mortgages, but few people realize you can actually purchase a home using a reverse mortgage. This is called a HECM for purchase.  

The Home Equity Conversion Mortgage (HECM) is a federally insured FHA reverse mortgage. The HECM for Purchase is a reverse mortgage. The HECM for purchase is a reverse mortgage program that allows seniors 62 and over to buy a home never having to make a monthly mortgage payment*.  

The borrower is responsible for the initial down payment, property taxes, maintenance and home insurance.  As a borrower you may choose to make a payment, but no payment is required. The loan is paid when the home is sold, it is no longer the borrowers’ primary residence, or the borrower passes away.

WHO QUALIIFIES FOR HECM FOR PURCHASE

•Eligible borrower must be 62 years of age or older

•Borrower must meet Department of Housing & Urban Development (HUD) financial criteria

•Home being purchased must become borrowers’ primary residence

•Home can be a single-family home or an FHA approved condominium

•Home must be occupied within 60 days of loan closing

WHAT ARE THE BENEFITS OF THE HECM FOR PURCHASE

•No monthly payments — borrower is responsible for property taxes, insurance, and home maintenance

•Borrower owns the home – borrowers name is on title

•No risk of foreclosure as long as FHA requirements are met

•Single down payment by the borrower (cash from previous home, sale or cash on hand) the balance is covered by the HECM proceeds

•Increased monthly cash flow because of no monthly payments allow more money for other expenses or enjoying retirement

•Increase purchasing power.  HECM proceeds allow you purchase more home and afford additional amenities

•Loan is not repaid until the home is sold, last surviving homeowner vacates the property for 12 consecutive months or passes away

•HECM for Purchase is a nonrecourse loan. This can help ease estate concerns

This program is not too good to be true. This is a federal program specifically designed to help seniors navigate their retirement years.

So, if you are a senior 62 years of age or older, want to increase your purchasing power, increase, your monthly cash flow, own your home with no monthly payment* and move into a home that fits your lifestyle, then you may want to look into a HECM for purchase.  

* Borrower must live in the Home as their primary residence, pay property taxes, homeowners’ insurance, HOA dues (if applicable) and maintain the home.                

(Joseph P.Kurelic, Reverse Mortgage Specialist Eatonton, Ga. — Homebridge Financial Services)

THOUGHT FOR THE DAY:  “Keep your face always toward the sunshine, and shadows will fall behind you.”  (Walt Whitman)

Contact Information: Shirley Smith RE/Max Lake Country Greensboro, Ga.  706-453-6333