Can A Reverse Mortgage Be Used to Purchase A Home? | HECM for Purchase

Can A Reverse Mortgage Be Used to Purchase A Home
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In this video we discuss the question "Can A Reverse Mortgage Be Used to Purchase A Home?".
The simple answer to that is "yes", but I'm going to explain further with a couple of examples.

With a reverse mortgage, you can borrow a percentage of your home's value (or purchase price) and you don't have to make a monthly payment for as long as you live or for as long as you live in your home.

The way that is works it at age 62 (which is the point of entry for an FHA reverse mortgage) you can borrow about 40% of your home's value or purchase price. Keep in mind that this does depend on the program, interest rates, and is subject to change weekly. Roughly, you can borrow 40-65% of the home value depending on your age.

At age 62 you can borrow roughly 40%. So, if you buy a home for $800,000 then you can borrow about $320,000 leaving a down payment requirement of $480,000 plus closing costs. So, basically, you can get into an $800,000 with just a down payment of $480,000 plus closing costs. BUT, what does that get you? It gets you NO mortgage payment for as long as you live or for as long as you live in the house.

Alot of people think about downsizing and selling their bigger or more costly home and then paying cash for the smaller or more economical home so that they don't have a mortgage payment.

With a reverse mortgage, you can do the same thing (referring to not having a mortgage payment) except you don't have to part with as much cash. 2:07

2:14 As far as I'm concerned, not enough people take advantage of this program.

2:18 On the other side of the age spectrum, we have a 90 year old. Again, it depends on the program. There's a proprietary reverse mortgage and an FHA reverse mortgage. At this point in time a 90 year old can borrow about 64-65% of the purchase price.

2:35 So how does that work in terms of buying a home with a reverse mortgage at age 90? Since you can borrow about 64% of the purchase price, it means you can get about $512,000 with the reverse mortgage. Subtract $512,000 from the purchase price of $800,000 and that leaves you with a down payment of $288,000 plus closing costs. Again, that means you don't have a monthly mortgage payment for as long as you live or for as long as you live in your home.

3:12 A couple quick notes before I sign off. There are lower points of entry in terms of the reverse mortgage. In some states it can be done at age 55. Some states have different requirements, but you may be able to do a reverse mortgage as young as age 55.

🔥Get Your Free Info Kit🔥
For More Reverse Mortgage info, contact:
Shawn@LifeSourceMortgage.com
(949) 492-2252 x 704

🔥🔥🔥🔥More Info🔥🔥🔥🔥
https://lifesourcemortgage.com/reverse-mortgage
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www.LifeSourceMortgage.com Is not a lender or bank nor are we part of HUD / FHA. We are however a licensed mortgage broker In California, Colorado, and Idaho that specializes in reverse mortgages, fast closing purchase loans, and more. Anyone that inquires and requests more information may be contacted by the owner or employee of this site. LifeSource Mortgage, CA BRE#01869699. NMLS#321759, ID MBL#2080321759.