One interesting feature of the some newer reverse mortgages that are available is that you can use the program to purchase a new home \u2013 all in a single transaction. The transaction reduces the out-of-pocket cash needed to buy a new home, eliminates any new monthly mortgage payment, and helps you keep more of the sales proceeds from the old house \u2013 or a larger amount of savings \u2013 to use for other purposes.<\/p>\n
For example, let\u2019s say a 75-year-old woman sells her home in Pennsylvania for a $100,000 profit and wants to buy a new home in Florida costing $150,000. To avoid a mortgage payment on the new house, she would need to pay $50,000 in cash. This means she would have to use the entire $100,000 from the sale of her first home, plus another $50,000 from her savings. If she doesn\u2019t have the $50,000, she couldn\u2019t buy the new house, unless she qualifies for a new home mortgage, which might be difficult and which in any event would require making monthly mortgage payments again.<\/p>\n
Alternatively, the woman could qualify for about a $100,000 reverse mortgage, purchase the new home outright, or nearly so, using money from the reverse mortgage, plus the $50,000 of the profit on her Pennsylvania home. She would be in her new home with no monthly payments and approximately $50,000 in her savings account.<\/p>\n
This type of reverse mortgage might be used, for instance, by older homeowners, who want to sell their old home and move closer to their children, to a warmer climate, or move into a home that provides greater accessibility or easier maintenance.<\/p>\n","protected":false},"excerpt":{"rendered":"
One interesting feature of the some newer reverse mortgages that are available is that you can use the program to purchase a new home \u2013 all in a single transaction. The transaction reduces the out-of-pocket cash needed to buy a new home, eliminates any new monthly mortgage payment, and helps you keep more of the …<\/p>\n