By James, Kelly, PGA National Home owner and guest blogger.
The Reverse Mortgage for Purchase is becoming more and more popular as Senior Consumers and Realtors alike are recognizing the advantages of this Government sponsored mortgage program. Whilst the Reverse Mortgage has been mainly used by Senior Consumers to use the equity in their homes to defray living costs and pay down debt, the program was broadened about two years ago to enable seniors to use a Reverse Mortgage for the purchase of a primary dwelling.
The advantages are, you can be qualified if you are 62 years of age or older regardless of income or credit history. They own the home, there are no monthly payments to make and there is no personal liability for the Senior Consumer nor for his or her heirs.
Many seniors moving to Florida are unable to access conventional mortgage credit due to current market conditions, past credit history or insufficient income to qualify. The solution to these issues is the Reverse Mortgage whereby the seniors do not have to utilize all their cash for the purchase and can purchase a better home, conserving capital at the same time and not fretting about monthly payments.
By the same token the Realtor can get the Senior Consumer a better home and not be concerned about having the client qualify for a mortgage. In addition the FHA lending limit for Palm Beach County on a Reverse Mortgage is $625,500 versus $417,000 on a “Forward” mortgage thus giving more latitude to the Senior and the Realtor to conclude a mutually satisfactory transaction. Similarly, the proceeds are tax free and do not affect Social Security.
Reverse Mortgage Consultant
MetLife Bank N.A.