Bob Massi “The Property Man” on Using Reverse Mortgages for Home Purchase

posted in: Home Page, Purchase

Bob Massi, “The Property Man”, interviews 2 couples and their loan officers to understand the benefits of using a reverse mortgage to purchase a home.

The 1st couple, the Kramers, sold their existing home for $500,000. They used $143,000 of the proceeds to purchase their new home (valued at around $300,000), paid off the mortgage on their previous home, and still had funds to invest. They freed up a substantial amount of monthly income (by having no more mortgage payment), and still pocketed money for other uses.

The 2nd couple, Ralph and Mary, not only did a reverse on their original home, but chose to do a reverse mortgage when they eventually decided to downsize.

The HECM for Purchase Program was introduced by HUD in 2009, allowing seniors for the 1st time to purchase a property with a reverse mortgage. “This is a traditional loan”, states reverse mortgage expert Josh Shein. “The difference is that instead of your balance going down and having to make payments every month, the payments you would be making are being added to the balance of the loan. So the balance is going up a little bit every month.”

Here are some of the facts highlighted on Mr. Massi’s broadcast:

  • No matter how long you live in the home, or what happens to its value, you only make one down payment and that’s it.
  • For as long as you live in the home you will never have to make a payment
  • Youngest title holder must be 62 years of age or older
  • The amount you can borrow at 62 is approximately 51-52% of the value of the home, and increases with the age of the borrower
  • The home must be your primary residence
  • Must be a singe family home, 2-4 unit property, or HUD approved condo
  • When you sell the home your heirs retain whatever equity is remaining in home (whatever the home can be sold for minus the payoff of the reverse mortgage)

Find Out What a HECM for Purchase Can Do For You…

Before you downsize, find out how a HECM for Purchase would impact your finances. Schedule a free consultation with a Landmark Reverse Mortgage Planner.