A Client’s Review of Reverse Mortgage for Purchase

reverse mortgage colorado fort collins loveland windsorThis first hand account of how the decision to go with a Reverse Mortgage for Purchase instead of paying cash for a home changed the course of life for these homeowners is really impressive.  I absolutely LOVE hearing stories like this!


Reverse Mortgage for Purchase (aka HECM for Purchase) is available to seniors 62 and over.  Borrowers are required to meet the same age guidelines as with a traditional reverse mortgage, but instead of using the equity from an already existing home they own, they contribute a down payment towards the cost of a new home and the reverse mortgage lender makes up the remainder of the cost – leaving the borrower with NO mortgage payment.  The amount of the down payment is calculated a couple different ways and changes based on the age of the homeowner and the value of the home (click here to learn more about down payments).

We bought our house with a reverse mortgage in 2010. We put down $115K, received as inheritance from my husband’s mother, which could have bought us a 2 BR 1 bath 900 sf on a tiny lot with no mortgage. Instead we have 5 acres, 1850 sf 3 BR 2 bath home, a barn for my 2 horses (which boarding would have been costing us $600 a month at least), 12 x 24 greenhouse, two storage buildings, a workshop, and a pool in an equestrian neighborhood that is peaceful and quiet with no barking dogs, roaring cars, or loud trashy neighbors.  The Reverse Mortgage for Purchase gave us the ability to purchase a much nicer home and still live mortgage payment free.

We pay property taxes, insurance, and upkeep. We do not “co-own” the house with the mortgage company as many believe is the case with a reverse mortgage. It is in our names and we can sell it if we decide to do so. The reverse mortgage is treated just like any other mortgage at the time of sale. It’s paid off at closing and the equity goes straight into our pockets. And we do have equity…in fact, since real estate has rebounded, particularly in our equestrian community, we have more equity than when we bought the house even after having the RM for four years.

We have nobody to leave the property to.  My husband’s children disappeared out of our lives years ago and I have no kids. We’ve left everything in the hands of our lawyer to be sold and the funds split between two animal charities. If we had offspring we wanted to leave anything to, they would have time to decide what to do with the house – either refinance it and pay off the mortgage, sell it and take any equity, or another option.

~ Happy with Horses


Here are few basics to the reverse mortgage for purchase program:

  • The purchaser must be age 62 or older (each borrower on title must meet this criteria, although others residing in home do not)
  • The home being purchased must be the new primary residence
  • The purchaser must have the “required investment” (down payment) from a HUD allowable source. The funds cannot be borrowed. The required investment can come from the sale of a currently owned asset or money you have had for at least 90 days.
  • Eligible properties include: single family homes, town homes, and FHA approved condos.  A loan can not be applied for on a new construction home until it has a it’s “Certificate of Occupancy”.

Jan Jordan Reverse Mortgage Info for Fort Collins, Loveland, Greeley, and Front Range areas of Colorado.

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