About HECM for Purchase

Realtors | Purchase FAQs | Purchase Guidelines

It’s important to understand the guidelines for the HECM for Purchase Program.

Request a copy of HECM for Purchase guidelines

This highly successful program gives a wonderful opportunity to people who are 62 years or higher in age. The reverse mortgage purchase option allows you to minimize your cash requirement, get more home for your money and have no mortgage payments to make.
The reverse mortgage purchase plan allows you to keep more of your retirement savings in your investment accounts because you don’t need as much cash for your home purchase.

How does the reverse mortgage purchase program work?

The money sources for your new home purchase comes from your down payment and borrowed funds from the bank. The reverse mortgage agreement is that you pay the bank or lender back after you leave your home permanently. Therefore there are no monthly payments during the time you occupy your home. Based on age of the youngest borrower, the current expected interest rate and purchase price of your new home, we calculate your down payment.
Find out your down payment requirement

You can live in your home as long as you like.

There are no payments required until the last homeowner leaves the home permanently. See How a Reverse Mortgage Works

You must occupy your new home within sixty days of closing!

It is very important you understand that when you purchase a home using a reverse mortgage, it must by your primary residence. People are tempted to try to get a reverse mortgage and later turn it in to investment property, but DON’T! This is an owner occupied mortgage and at the point the owners move out, the loan will become due. If you decided to move and have renters or family members occupy your home, you must pay off the reverse mortgage.

Reverse Mortgage Purchase Transactions Are Different!

Before you make an offer, you must understand the reverse mortgage purchase requirements. Request a copy of HECM for Purchase guidelines

Your Real Estate Agent needs to be aware of what is included in the original offer to purchase.

Documents are date sensitive so you must do it right from the start!

There are additional forms needed when making an offer using a reverse mortgage as financing. Make sure you have the proper forms in your offer package. Part of my job is to analyze the details of your proposed transaction before making an offer. Your full plan must be evaluated. We will ask questions like; Are you keeping your current residence? Will you be renting in out? Have you had a foreclosure or short sale in the past three years?
I will take on the role of pre-underwriter and determine early if your proposed transaction is likely to be approved or not for the reverse mortgage purchase program. You, your agents, the people trying to sell their home all rely on a proper determination of approval from the beginning. Critical time and money can be wasted with a hasty upfront evaluation. So if you are an agent or a homeowner, take responsibility right now to learn how to create a successful purchase transaction and have the wonderful benefits of not making mortgage payments on your new home.

It’s important to understand the guidelines for the HECM for Purchase Program.
If you would like to have a copy of the reverse mortgage purchase guildelines, click here: HECM for Purchase guidelines

If you would like the additional forms that are required to be included with your purchase offer, click here: Reverse Mortgage Purchase Documents to be included in purchase offer

Points to be aware of:

• There are no seller concessions and sellers are limited on fees and closing costs they are allowed pay.
• Reverse Mortgage Counseling must be completed prior to opening escrow!
  

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