With much invigoration, the answer is a resounding YES!
Most folks don’t realize that if you are age 62 years of age or older, you can use a Reverse Mortgage to actually purchase a new home.
That’s right. They aren’t just for people who need to supplement their retirement or expenses.
How do you buy with a Reverse Mortgage?
Simply put, if you have a substantial down payment, or you are selling one house to buy another you may be able to pay for the rest of the home using money from a Reverse Mortgage. On average you will need to come in with a 30-40% down payment depending on your age.
The older you are, the less you have to put down. Most Reverse Mortgages however, will provide approximately 60-70% of the appraised value of the home.
Can you give me an example of a Reverse Mortgage Purchase?
Certainly. Lets say you want to buy a home for $200,000. You would need approximately $60,000 to $80,000 as a down payment. Wherever this comes from is up to you. Whether it be retirement funds, prior home sale proceeds, lottery winnings, whatever it may be. You would buy the home for $200,000, put in your down payment, and the rest would be covered by the Reverse Mortgage. You would now own your home without a payment for the rest of your lives.
Keep in mind however, that interest will accrue over the life of the loan, but how wonderful would it be to be able to live in your home without a mortgage payment? What a great feeling. All you have to do is pay your property taxes, homeowners insurance and maintain the general upkeep of the property, things you would do anyhow.
I’d be happy to answer any questions you might have on the Reverse Mortgage Purchase Program. Good luck in your journey!