Are you 62 years of age or older and want to enjoy your retirement years in beautiful Florida weather? Or maybe you’re in South Florida now and you want to tap out your existing equity…have a brand new, beautifully built custom home, cut your taxes in half, insurance in half and live in Florida’s fastest growing retirement community…Harbor Hills….
If the answer is yes….lets talk about a very solid financial option for you to make that happen….its called FHA’s Home Equity Conversion Mortgage….better known as a reverse mortgage…
A conversion mortgage is a very misunderstood product that has a much broader reach and more benefits to those 62 and older than illustrated on TV . The HECM product can certainly be used to increase a consumer’s monthly cash flow — that is a given….But in addition, the HECM for Purchase program is a great way for those 62 and older to consider buying a home or building that dream retirement home you’ve always wanted in sunny Florida!
With over 8,000 people turning 62 each day — 3 million annually —you need to be informed of all their options available to you…
First..What is a reverse mortgage?
A reverse mortgage is a special type of home loan that lets you convert a portion of the equity in your home into cash. The equity that you built up over years of making mortgage payments can be paid to you. However, unlike a traditional home equity loan or second mortgage, HECM borrowers do not have to repay the HECM loan until the borrowers no longer use the home as their principal residence…..and you can use a conversion mortgage to purchase a primary residence..and at harbor hills….even using our new build program to build your dream retirement home just the way you want it….giving you your dream retirement home with much more cash on hand vs. paying 100% cash….
Now…Let me give you a quick example so you can see how this works:
Say someone from New York wants to retire right here in beautiful Harbor Hills in Lady Lake, Florida. They sell their house in New York and end up with $400,000 to finance their next house.
With a traditional mortgage they would have to come up with a down payment and closing costs, then make monthly payments for the life of the loan. They could also pay cash, which eliminates monthly payments but that option puts a ton of cash into the home that could otherwise go in your pocket, your bank or into a better investment..a more liquid better yielding investment.
Now — the purchase program using a conversion loan allows you to put roughly ½ down into the new home, keep the other ½ and never make a mortgage payment again on your new home….lets go back to the example of the 400,000 sale of the new york home….
Lets say you want to build a 300,000 retirement home, a 70 year old would need a down payment of approximately $147,000….roughly ½…..This would leave about $253,000 from the $400,000 sale of the new york home to put in their pocket when they left New York, versus only $100,000 if they were to do a cash purchase.
In addition, you would have zero mortgage payments…zero…ever again….done..you are just responsible for HOA fees and taxes…
When you either move or both spouses pass…the house is sold, loan is paid back…additional equity goes to your estate…if the house is upside down…its insured by FHA…so NO, your heirs have no liability…nor would your spouse if you passed ….they would never have to worry about a mortgage payment…..
This program allows you to have control of your cash…why put it into your retirement home when you can use it to either enjoy a phenomenal lifestyle or even put it into another investment that will give you both liquidity and a higher yield.…..
And even better, because this program requires you to purchase a finished home…Harbor Hills has a special program that allows you to build a new home and STILL use this program..something very few retirement communities provide…
Ultimately the question you have to ask yourself is this…Do you want to leave behind greater equity, perhaps even a fully paid off piece of property to your children or grandchildren or not…because if the answer is no…this make a ton of financial sense….and research shows that over 90% of children want their parents to enjoy the fruits of their many years of labor and sacrifices…to enjoy every day, live life to its fullest…
To be eligible for a FHA HECM, the FHA requires that you:
- Be a homeowner 62 years of age or older,
- Either own your existing home outright, or have a low mortgage balance that can be paid off at closing with proceeds from the reverse loan,
- Have the minimal financial resources to pay ongoing property charges including taxes and insurance, and you must live in the home…..
Below I’ve include a link to a website that you can goto for more information and a phone number you can call to inquire more about Reverse mortgages.
http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/hecm/hecmhome
1-800-822-5558
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