A study conducted by Georgetown University has found that a majority of seniors prefer to age in place. But holding on to the family home in retirement is not the only option – a growing number of America's retirees are taking advantage of a powerful financial tool that relives some of the financial hurdles that seniors who are looking to buy a new home might face.
A Home Equity Conversion Mortgage for Purchase (commonly referred to as H4P) was established by the Federal Housing Administration in 2008 to assist homeowners 62 or older buy a home that suits their retirement needs.
This home financing program is designed specifically to get seniors the funds they need to make a home purchase by combining a down payment with loan proceeds from a Home Equity Conversion Mortgage. And just like a standard HECM, even with a new purchase, borrowers will have no monthly mortgage payments.
Today, conventional conforming no-point 30-year fixed mortgage rates are averaging 4 percent while 15-year rates are near 3.125 percent.
Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.