Using a Reverse Mortgage to Buy a New Home

Short answer: HECM for Purchase lets homeowners 62 and older buy a new primary residence by combining reverse mortgage proceeds with a down payment from savings or the sale of a previous home — with no monthly mortgage payment required afterward.

Why homeowners use this

It’s common for retirees to want to downsize, move closer to family, or relocate to a home better suited to their needs — without tying up all their cash in a new purchase, and without taking on a new monthly mortgage payment in retirement.

How the numbers work

You still bring a down payment to the table — typically a significant portion of the purchase price, funded by the sale of your previous home or other savings — and the reverse mortgage covers the rest. The exact down payment required depends on your age and the new home’s purchase price, since it’s calculated the same way a regular reverse mortgage proceeds amount would be.

What still applies

The same rules apply as any reverse mortgage: the home must be your primary residence, you’re still responsible for property taxes, insurance, and upkeep, and it remains a non-recourse loan. Independent HUD counseling is still required before closing.

Is this the right move for you?

Talk to us about your specific move — we’ll walk through what a HECM for Purchase down payment would look like for the home you have in mind.