Purchasing a home with a Reverse Mortgage....great idea for some

Ed Moda,Reverse Mortgage Specialist
Email: emoda@acceptancecapital.com
Cell: (206)930-5606 Off: (425)458-2651

A Reverse Mortgage is a Government Insured program that was created by the FHA to allow Senior Citizens over the age of 62 to access the equity in their homes as tax-free income without making any monthly payments during their lifetime or until the home is sold.

There are no credit, employment or income requirements for the program which makes it much easier to get than a traditional loan. The actual name for the program is a Home Equity Conversion Program or HECM. Based on three determining factors, age, home value, and the banks interest rate, any senior can qualify to receive a portion of money to be used without restriction for their financial needs.

Reverse Mortgages loans have always been a great way to turn the equity in your home into tax free cash – without having to make monthly payments. Changes by Congress to the FHA-insured Reverse Mortgage program now allow seniors to buy a home with a Reverse Mortgage – with no credit score requirement or income verification!  Although this sounds too good to be true, Americans 62+ can now use the equity from the sale of their previous home, or other cash or savings, to move into a different home – just with a single down payment. You will never have to make another mortgage payment, as long as you live in the home as your primary residence, maintain your home, and pay taxes and insurance. Imagine the financial independence you can achieve by eliminating your mortgage payment once and for all. Best of all, if your home’s value appreciates during the term of the Reverse Mortgage you (or your heirs) keep any remaining equity after repaying the Reverse Mortgage loan.

Purchasing a home with a Reverse Mortgage is very similar to purchasing a home with a conventional mortgage.  Rather than determining a down payment based solely on the purchase price, the minimum down payment will be based on a factor of your age, interest rates, and the lesser of the home’s appraised value, purchase price, or FHA-imposed national lending limit.

Reverse Mortgage appraisals, inspections, contingencies, documents, and closings are virtually the same as those with a conventional mortgage. Because of the HUD-required independent borrower counseling, some Reverse Mortgage escrow periods may be slightly longer than that of a conventional mortgage – although this isn’t always the case

The basic eligibility requirements to purchase a home with a reverse mortgage are:

1.      All titleholders must be aged 62 or over

2.      The purchased home must be your principal residence

3.      The purchased home must meet HUD’s minimum property standards and be

either a single-family residence, a residence in a 1- to 4-unit dwelling, certain

condominiums, or an eligible manufactured home.

4.  The down payment must be from qualifying sources

5.  You must complete a HUD-approved counseling session

The basic benefits are:

1.      Eliminates Mortgage Payments

2.      No income or minimum credit score requirement 

3.      You keep the title

4.      Remaining equity goes to you or heirs, not the bank

5.      No pre-payment penalty

6.      FHA-insured

7.      Loan is non-recourse (This is a big Deal)

For more information about this program: