HECM for Purchase
A Home Equity Conversion Mortgage (HECM) for Purchase from Longbridge Financial is a home equity solution that you may be able to use to purchase a new home—all without making monthly mortgage payments.
Of course, a HECM for Purchase reverse mortgage is still a loan, so interest does accrue on the portion of the loan amount disbursed. As with any home, the homeowner maintains responsibility for paying property taxes, insurance premiums and necessary maintenance.
You can use a HECM for Purchase reverse mortgage to relocate to a home that’s closer to your family, one that’s more physically accessible, or a home that’s a better size for your current or future needs.
Key facts about HECM for Purchase
- If you qualify, you can buy a home or FHA approved condo as your principal residence by taking out a HECM reverse mortgage on that property.
- Using proceeds from the sale of your current home or cash on hand, you make a down payment (usually 40% to 50% of the cost of the new home) and cover closing costs.
- The balance of the purchase is covered by your HECM proceeds—any remaining funds can be used as you choose.
- There’s just a single closing, as the home purchase and HECM reverse mortgage are executed in one transaction.
- You make no monthly mortgage payments on the new home.
- You—not the bank—own the home, and you can continue to live in it as long as the terms of the loan are met.
- The loan is repaid—including principal plus accrued fees and interest—when the last surviving homeowner vacates the property for 12 months of the home or passes away.