Mortgage Benefits for Seniors

THERE’S A PROGRAM THAT ARE ALLOWING SENIORS
TO BUY A HOME, WITHOUT A MONTHLY PAYMENT

Reverse Mortgages have been popular for a number of years as a way for seniors to tap the equity in their homes without selling them. Under the Housing and Economic Recovery Act of 2008, seniors can now use a Reverse Mortgage - referred to as a Home Equity Conversion Mortgage (HECM) - to actually finance the purchase of a new home, as of Jan. 1, 2009.
An alternative to traditional financing
The new option works exactly like a traditional HECM Reverse Mortgage, with two major advantages. The first advantage is that there are no income requirements or restrictions, and there is no minimum credit score. This program has the advantage also of allowing seniors to tap into their equity to buy another home without ANY required mortgage payment.

This option offers an exciting and attractive alternative to traditional options for seniors purchasing a new home, as seniors today face a challenge getting financing, particularly in today's market.
How it works
The concept is admittedly confusing at first - how can one use a Reverse Mortgage to buy a home one doesn't own yet? But it's actually fairly straightforward: you're using the proceeds of the previous home, but purchasing their new home without the worry of making mortgage payments.
For example, suppose a senior couple in New Orleans want to sell their home and move closer to the Grandkids in Baton Rouge. Their house is valued at $200,000, but the home they want to buy close to the LSU campus costs $300,000. Previously, their only option would be to sell the house and get a new mortgage for the remaining $100,000. For seniors on a limited income, qualifying for and making the payments on such a mortgage could be a serious obstacle.
With this program, they would be able to put up $140,000 from the sale of the property as a down payment, cover the rest with a $160,000 Reverse Mortgage, pocket the remaining $60,000 TAX FREE from the sale of their original home and live mortgage-free for the rest of their lives!

The couple still owns the home outright and they or their estate can still profit from any increase in the value of the home, minus the amount necessary to pay off the Reverse Mortgage when it is eventually vacated and sold.
Eligibility and Availability
The program is available to seniors age 62 and above. The amount available to be funded through a Reverse Mortgage depends on a formula based on the borrower's age and the purchase price of the home - older borrowers can qualify for a larger Reverse Mortgage than younger ones.
Who would benefit? People that have the money to put down, but for whatever reason, has neither the credit or the income to qualify.
If either you, a parent or grandparent are looking to either upsize or downsize and are confused about their financing options, don't hesitate to get in touch with us. Again, the reverse mortgages have been around for a while, and the expansion of this program are allowing folks to buy a home that up to now, could not.
There's so much more we have available on this new expansion, so please check out our website, or email me at information@networkfundingla.com for more information