how to buy a house that has a reverse mortgage

 · About four years ago, the owner of the house next door died. She had just gotten a reverse mortgage on it about a year before. Her heirs didn’t want to buy the house back from the mortgage company and the house has been sitting empty for four years now.

Why can’t a reverse-mortgage foreclosed house be sold for less than appraised value? Asked by Jordanna Bentley, Livonia, MI Sat Feb 18, 2012. There is a house in my neighborhood that is being subject to some federal rule 24 CFR206.125, whatever that means, but it has to do with the fact that the property is foreclosed due to the previous owner (now deceased) having obtained a reverse.

If your children are heirs and can pay off your reverse mortgage loan, they may be able to keep your home after you die.

Primary lien: A reverse mortgage must be the primary lien on a home. Any prior mortgage must be paid in full to acquire the reverse mortgage. (reverse mortgage proceeds can be used for this purpose,) Occupancy requirements: The property used as collateral for the reverse mortgage must be your parents’ primary residence.

Borrowers generally get a fixed-rate, lump sum loan, which goes toward the house purchase. The balance starts accruing interest immediately. You can leave some reverse mortgage proceeds in a line of credit for future use by taking an adjustable-rate loan, and you will pay interest only on the proceeds you use.

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While I have written about reverse mortgages in the past, I thought I would touch on. home for longer than 12-months the loan would be due). If you live in the house until you pass away the house.

Experts say zero-down programs, through which people can purchase a house without a down payment, have become. for someone.

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Seniors who purchase a house with a reverse mortgage must have the means to pay the difference between the sale price of the property and the maximum amount they can draw on the HECM. As an illustration, a senior aged 62 purchasing a $300,000 house on July 25 could fund about half of it with a reverse mortgage.

So if you were to buy a $400,000 house with a $200,000 mortgage, your upfront insurance premium would be 1.75 percent of $200,000, or $3,500. But if you buy a $400,000 home with a $200,000 HECM, the insurance is calculated based on the home’s value.