HECM for Home Purchase Provides Seniors a New Option for a
Tampa, Fla. Jan. 21, 2010 Senior homeowners looking to buy a new primary residence may
benefit from the HECM for Purchase program.
With the FHA Home Equity Conversion Mortgage guidelines, homebuyers age 62 and over can
purchase a home with a reverse mortgage. Previously, a reverse mortgage was merely a
refinance tool enabling senior homeowners to convert built-up equity in their current home into
tax-free proceeds. Now seniors can use a reverse mortgage to buy a new primary residence and
obtain the loan within a single transaction, eliminating the need for a second closing.
“This program was designed to purchase a home. The benefits enable the mature homeowner to
purchase a home closer to friends and family members or move to a home that better meets
their physical and financial needs, especially a home that is easily accessible with modern
amenities or one that's smaller and easier to maintain,” said Linda Hyman, a reverse mortgage
consultant for Wells Fargo.
The HECM for Purchase reverse mortgage is FHA insured and combines the reverse mortgage
proceeds with the customer's funds. This results in no monthly payment for the home buyer.
The cash required for closing may come from the sale proceeds of the departure home or other
allowable sources, such as the sale of personal assets or the home buyer's savings. The reverse
mortgage is placed on the newly-purchased house, which can be an existing home or new
construction. The senior must occupy the property within 60 days from the closing date.
The borrower retains title and ownership of the home as long as program requirements are met,
including keeping the taxes and insurance current and maintaining the property to FHA
Wells Fargo Home Mortgage is one of the nation’s leading retail mortgage lenders and services
one of every six mortgage loans in the nation. A division of Wells Fargo Bank, N.A., it has a
national presence in mortgage stores and banking stores, and also serves the home financing
needs of customers nationwide through its call centers, Internet presence and third-party