Use Your Reverse Mortgage for Purchase of a New Home
You may know that reverse mortgages are an excellent option for seniors who would benefit from income supplements. Another great use of a reverse mortgage utilized by some is in the purchase of a new home. Using the equity you have built in your existing home, you may be able to purchase a new home and, in some cases, keep both properties. At Texas Reverse Mortgage, Inc., our loan officers have more than a century of combined experience helping Texans with reverse mortgage for purchase. If you live in Austin, Dallas, Fort Worth, San Antonio, Houston or anywhere in Texas, contact us today. We are happy to answer your questions as you begin exploring reverse mortgage for purchase and guide you through your options.
Eligibility for Reverse Mortgage for Purchase
Reverse mortgages for purchase, or home equity conversion mortgages (HECMs) for purchase, are not available to everyone. Applicants for an HECM for purchase must be at least 62 years old. Reverse mortgages – for supplemental income or purchase – are designed to help seniors who have a substantial amount of wealth wrapped up in their residence. Using the equity they have built, these people can purchase new property with the HECM loan proceeds.
It is important to keep in mind that in addition to the age requirement, HECM for purchase borrowers will need to meet financial eligibility criteria, will need to occupy their new homes as their primary residences and must complete an interview with the Department of Urban Housing and Development. Our loan officers can plainly explain these and other requirements and help you along your journey to purchase a new home.
Choosing an HECM for Purchase
Our clients choose reverse mortgage for purchase for several reasons. Some want a smaller, more accessible, or otherwise better-suited home. Others would like to move closer to family members in a new area. Other clients would like a secondary residence in a different area of the country. Whatever their goals are, HECM for purchase allows them to obtain a reverse mortgage and purchase a new home in the same transaction.
A New Home Without a Mortgage Payment
When you choose a reverse mortgage to purchase a new home, you eliminate your monthly mortgage payments. This is a great relief to many of our clients who are on a fixed income. The main expense in an HECM for purchase is an initial payment for the difference between a new home’s purchase price and the amount of HECM loan proceeds a person receives.
You may be curious how your loan is paid back when you are not making mortgage payments. This type of loan is offered only to certain borrowers to maintain a low level of risk to lenders. Your HECM is repaid through the sale of your home after your death.
It is important to note that volatility in the housing market will not affect your dependents or heirs after your death. The HECM program, which is controlled by the Federal Housing Administration, mandates that even if your home is sold for less than is owed on your loan, your dependents cannot be held liable.
A Silver Lining and a Secure Future
If you are looking for a more comfortable or suitable home for your family, it is never too late to consider your options. Our loan officers at Texas Reverse Mortgage, Inc., are here to help you make the most of your home equity. If you live in Austin, Dallas, Fort Worth, San Antonio or Houston, call the Texas experts when it comes to reverse mortgage.