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HECM For
Purchase: an important mortgage option
A
reverse mortgage is an important option that can help homeowners
age 62 and older improve their lives. However, many people
aren't aware that a reverse mortgage can be used to purchase a
home through the Home Equity Conversion Mortgage (HECM) for
Purchase program.
So,
what exactly is a HECM for Purchase? Simply put, a HECM
for Purchase helps you purchase a home by taking out a reverse
mortgage on that home, without the financial impact of monthly
mortgage payments.* Borrowers may, for example, use a HECM
for Purchase to relocate to a home that's closer to family
members, more physically accessible, or "right-sized" for their
needs.
"A
HECM for Purchase is a great option for older adults, because it
can help them attain a house that's right for their needs
without having to go through the traditional mortgage process -
and their credit history and income are not a factor" says
Bill Thomas, Reverse Mortgage Consultant for MetLife Bank.
HECM for
Purchase: the facts
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A
HECM for Purchase enables borrowers to buy an existing one-
to four- unit home or condo by taking out a reverse mortgage
on that property.
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The loan proceeds are applied toward the home purchase.
In one transaction with one closing, the buyer uses cash on
hand to make a substantial down payment (usually 40% to 50%)
that covers the property's sale price and closing costs
minus the HECM proceeds.
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As with any reverse mortgage, the loan must be repaid -
including the principal plus accrued fees and interest -
when the last surviving homeowner permanently moves out of
the home or passes away.
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The borrowers - not the bank - own the home, and can
continue to live in it for as long as they want. The
homeowners must continue to pay property taxes, have
homeowners insurance and maintain the home.
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A
U.S. government guarantee ensures that the borrowers and
their estate will never owe more than home's fair market
value. If the home is sold for less than the loan
balance due, the U.S. Department of Housing and Urban
Development (HUD) will pay the lender the shortfall.
If it sells for more than the amount due, the borrowers or
their estate keeps the net proceeds.
There is
a lot of information and resources available to help you learn more
about the HECM for Purchase process. MetLife Bank offers free,
educational materials to consumers who may be interested in a HECM
for Purchase or would like more details. For more information
about a HECM for Purchase from MetLife Bank, contact at (866)
808-2019.
"A
HECM for Purchase can free up your money for other needs, and
it's a great way to get more out of life," notes Thomas.
Only
applicable for the purchase of a single family unit dwelling to
be occupied as a principal residence.
Program, rates, fees, terms and conditions are not available in
all states and subject to change.
*Although there are no monthly mortgage payments, interest
accrues on the portion of the loan amount disbursed.
All loans are subject to property approval. Certain
conditions and fees apply.
Mortgage financing provided by MetLife Bank, N.A., Equal Housing
Lender.
©2010 METLIFE, INC R0610111506[exp0611][All States][DC]
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Retirees
travel the Rhone river to Arles in Provence
where Vincent van Gogh painted. During the
river boat journey, they discuss their
common concerns and approaches to the
retirement transition.
