Can You Use a Reverse Mortgage to Buy Your Next Home? Yes, and Here’s How

Most people who have been on the market for a home are familiar with what the term ‘mortgage’ means, but many have not heard of a reverse mortgage and aren’t aware of how this product can benefit them. If you’re nearing retirement and are contemplating a new home or even relocation to another community, here are the details on a reverse mortgage and how this option may benefit you.

What Is A Reverse Mortgage?

While many homeowners may not have the net worth to be able to buy another home without selling their current one, a reverse mortgage enables the buyer to borrow money against the value of their home. Created in 2009 as the Home Equity Conversion Mortgage for Purchase (HECM), this type of mortgage can enable those older than 62 to relocate to a new house or move closer to their family without having to sacrifice the money they’ve saved or their fixed monthly income.

What Are The Requirements?

Beyond the minimum age requirement of 62 years of age, those who would like to utilize a reverse mortgage must either own the current property they are living in or have a high amount of equity in the property. They must be able to pay all of the costs associated with ownership of the home and the property they are purchasing must be able to pass the standards held by the Federal House Administration (FHA). In addition, applicants will have to go through a financial assessment to ensure they can make insurance and property tax payments.

The Benefits And Drawbacks Of Reverse Mortgages

A reverse mortgage can be a great benefit in that it enables those who are in their senior years to purchase a new home without having to utilize a portion of their fixed monthly income. However, because a reverse mortgage includes this benefit, it also comes in tandem with a higher loan balance and this higher balance means that interest will accrue more quickly. Dependent on this amount, this can actually diminish the equity in the home.

While the opportunity for a reverse mortgage has been around for a number of years, this alternative for purchasing a home has not been utilized by many homeowners since its inception in 2009. If you’re approaching your senior years and are considering the benefits of purchasing a new home, give me a call for more information – J.P. Cook – 602-320-4253.

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3336 S 155th Lane Goodyear, AZ 85338

$462,490

4 Beds

2 Baths

1,797 SqFt

Status Active

MLS # 6692746

Property Type Single Family Residence

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Below Market Financing Available!!!!!!!!! This single-level home showcases a spacious open floorplan shared between the Great Room, kitchen and dining room, with access to the covered patio for outdoor lounging and entertaining. The owner's suite enjoys a private location at the back of the home, complemented by an en-suite bathroom and walk-in closet. Three additional secondary bedrooms are comfortable and private retreats for household members and overnight guests. Photos are renderings of a model home, not the actual home.

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17913 W Addie Lane Surprise, AZ 85374

$462,000

2 Beds

2 Baths

2,302 SqFt

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MLS # 6644538

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NEW ROOF, NEW CARPET, Fully Paid Solar and so much more (See Supplement for additional Comments) makes this 3-bed, 2-bath, and AZ Room in the 55+ guard-gated & golf course Community of Arizona Traditions the one for you! 2-car garage, desert front yard with a front patio that includes a decorative Table and Benches. The kitchen has ample cabinets, Stainless Steel Appliances, center island, and dining area w/bay window. The owners' suite is spacious! Owners' Bath consists of a walk-in closet, storage cabinets, Tub, shower, and dual sinks. Enjoy the Beautifully enclosed heated & cooled Arizona Room. The Landscaping Water System uses PVC. A feature you can't ignore is fully paid solar with electric bills avg. $20 per month. BRAND NEW ROOF - Installed December 2023, Exterior Paint 2015. Other features that benefit the buyer include - AC Unit 2014, Mini Split 2019. BBQ -2021, New Carpet - December 2023, Wood Floor - 2017, Dishwasher - 2018, Microwave - 2020, Stove - 2018.

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15715 N 168th Avenue Surprise, AZ 85388

$462,000

4 Beds

2 Baths

2,166 SqFt

Status Active

MLS # 6662476

Property Type Single Family Residence

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Nicely appointed home in the attractive Surprise community of Surprise Farms. 4 bedrooms, 2 bathrooms, with a sought after kitchen greatroom open concept along with a separate formal living and dining room. Light and bright kitchen comes with corian countertops, stainless appliances, large island with sink, and upgraded white cabinets. Master bedroom has a large walk-in closet, double sinks, step-in shower, soaking tub, and private toilet room. The 3 other bedrooms are generously sized and all have a dedicated closet. Convenient location to neighborhood parks, shopping, dining, entertainment, and all the amenities that up and coming Surprise has to offer. VA loan is assumable to Veterans, Non-Veterans, and Investors! $2692 Monthly, 5% Interest Rate, $443,562 Balance as of 4/10.

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5432 W Beverly Road Laveen, AZ 85339

$462,000

3 Beds

2.5 Baths

2,170 SqFt

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MLS # 6670221

Property Type Single Family Residence

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AZ Resort Living at its Best! This gorgeous 3 bedrm, 2.5 bathrm, 2 car garage home is in the heart of Laveen (202 corridor). Newly painted interior,exterior & garage floor! Beautiful tile floors & new carpet T/O! Open floor plan makes for an entertainer's paradise. Kitchen has new quartz countertops,lowered counter/breakfast bar,new undermount stainless sink,new dishwasher,upgraded cabinetry. Some new lighting fixtures. Ground floor ensuite primary bedroom w/spa bathroom:separate shower,Garden tub & huge walk-in closet. Stepping outside onto the newly painted patio floor,bordered grass area ready for your personal touch,room for a pool! Located just moments away from shopping,dining, beautiful,parks & 202 freeway access (202 corridor). Easy access to Downtown Phoenix & Surrounding areas.

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