Can a Reverse Florida Mortgage Be Used to Purchase a Home?

Are you thinking about a reverse mortgage? If you’re over 62 years old, such resources can act like a Florida home equity loan, saving you time and money as you remain in your current residence.

But what if you wish to move? Especially for retirees, can a reverse Florida mortgage loan actually be used for a purchase, enabling the owner to not have to make any monthly mortgage payments.

The answer, courtesy of financial expert Bob Bruss, is yes: a “reverse mortgage for home purchase” is available from Fannie Mae. The two other major reverse mortgage lenders, FHA and Financial Freedom Plan, do not offer these special reverse Florida mortgage loans. They simply focus on the first kind, using such a loan to help those NOT planning to move.

A reverse mortgage for home purchase usually requires a large, cash down payment, typically around 50 percent of the purchase price. The balance is then funded from a reverse mortgage.

Such a reverse mortgage is ideal for the purchase of a retirement home where you obtain the down payment cash from the sale of your former residence. Be careful, however. Florida home loans of this nature can go wrong and you need to be aware of the dangers.