Reverse mortgage for purchase
Buy Your Next Home at 62+
Downsize or move closer to family, with no required monthly mortgage payment.
How a HECM for Purchase Works
A HECM for Purchase is a reverse mortgage loan used to buy a new primary residence. You make a larger down payment, usually from the sale of your current home or your savings, and the reverse mortgage covers the rest. There is no required monthly mortgage payment, but interest and fees are added to the loan balance, which grows over time, and your equity decreases.
The down payment is larger than a traditional loan because the reverse mortgage amount depends on the age of the youngest borrower, current interest rates and FHA limits. HECM limits are set by FHA and updated annually.
An FHA-insured Home Equity Conversion Mortgage (HECM) is available to homeowners 62 and older. It is a loan: interest and fees are added to the balance, which grows over time, and your home equity decreases. HUD-approved counseling is required and a financial assessment applies. HECM limits are set by FHA and updated annually.
Who It's Great For
- Downsizing to a home that's easier to care for
- Moving closer to the grandkids
- Right-sizing to single-level living
- Keeping more of your savings in the bank
Example, for illustration only
Downsizing from a larger family home
A couple, both 72, sell their long-time Fort Collins home and want a single-level home in Windsor near their daughter. They use part of the sale proceeds as the down payment, and a HECM for Purchase covers the remaining price. They keep the rest of their sale proceeds in savings and have no required monthly mortgage payment, while they continue to pay property taxes, insurance and HOA dues and maintain the home.
For illustration only; not a commitment to lend. Actual down payment and loan amount depend on age, rates, home price, FHA limits, counseling and a financial assessment.
Your Responsibilities
There is no required monthly mortgage payment, but you do have ongoing obligations. Not meeting them can cause the loan to become due.
Live in the home
It must remain your primary residence.
Pay property charges
Property taxes, homeowners insurance and any HOA dues.
Maintain the home
Keep the home in good repair.
When it comes due
When the last borrower sells, permanently moves out or passes away.
Planning Your Next Move?
Let's look at your numbers together, with your family if you'd like.
NMLS #172296 | Licensed in Colorado
A reverse mortgage is a loan that must be repaid when the last borrower sells the home, permanently moves out or passes away. Borrowers must live in the home as their primary residence, stay current on property taxes, homeowners insurance and HOA dues, and maintain the home. Interest and fees are added to the loan balance, which grows over time. HUD-approved counseling is required. These materials are not from, or approved by, HUD or FHA. Fort Collins Mortgage, LLC, NMLS #172296.