Can I use a reverse mortgage to buy a second home? You can ABSOLUTELY, use a reverse mortgage to buy a second home. However, there is a catch (kind of).
Here is the “catch” to the question can I use a reverse mortgage to buy a second home –
First of all, The home you are buying has to be a second home from an underwriting perspective. What we mean here is this; you can’t be buying this home to live in after your purchase it.
Hence, you can use it as a true vacation home, but not as your primary residence. At present, FHA rules only allow you to do a reverse mortgage on your primary residence. As soon as you move out of the reverse mortgaged house permanently, the loan becomes due.
You can do whatever you want with the money you get from a reverse mortgage
At the end of the day, a reverse mortgage lender does not care what you do with the money you get from the loan. Hopefully, you’re not going to Vegas and betting it all on a game of Roullette, but the choice is yousr. You can do as you wish with the loan proceeds.
What is a Reverse Mortgage? – The short version
It is a special type of loan that is made possible by the Federal Housing Administration. It is a mortgage for folks that are aged 62 or older. You can only do it on your primary residence and you still retain ownership to your home. The bank does not go on title at all. The beauty in a reverse mortgage is that there is no monthly payment for as long as you live or for as long as you live in your house. While there is no payment for you to make with a reverse mortgage, you are responsible for paying taxes and insurance.
If you want more information about using a reverse mortgage to buy a second home, contact us at: Info@ReverseMortgageLoanAdvisors.com
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