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Old 09-07-2019, 06:34 PM
 
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Anyone ever heard of this technique? Does it exist?


Retired couple, no kids, no heirs. Have a million dollars cash. Want to buy a 1.5 million house in a highly desirable area like Carmel but don't want to take out a loan that would require monthly payments. Would like to get an immediate reverse mortgage for half-million using the million cash as collateral. No payments. When I die the house goes to my wife. When she passes the bank takes the house. Doable?
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Old 09-07-2019, 10:14 PM
 
Location: Just south of Denver since 1989
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Yes. I have had buyers do a handful over time.

Reverse mortgage are FHA loans.
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Old 09-07-2019, 10:29 PM
 
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Originally Posted by 2bindenver View Post
Yes. I have had buyers do a handful over time.

Reverse mortgage are FHA loans.

Thanks, Denver. So you're saying before close of escrow the half-million reverse mortgage money is deposited into escrow along with the million cash and the reverse loan papers are signed just like a regular loan? And the papers stipulate that no payments on the half-million are due while the couple lives in the house?
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Old 09-07-2019, 10:57 PM
 
Location: Just south of Denver since 1989
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https://www.hud.gov/program_offices/.../hecm/hecmhome

Personally, I’d get a regular mortgage, make payments, and donate the property to charity.
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Old 09-07-2019, 11:27 PM
 
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Originally Posted by 2bindenver View Post
https://www.hud.gov/program_offices/.../hecm/hecmhome

Personally, Id get a regular mortgage, make payments, and donate the property to charity.

We're old. We don't want to be giving our money to the bank. And why would we want to give away a 1.5 million dollar house to charity after making all those payments? Doesn't make a bit of sense. We're charitable, but not THAT charitable! We're getting off topic anyway.
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Old 09-08-2019, 01:29 AM
 
6,895 posts, read 8,290,464 times
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Originally Posted by thrillobyte View Post
We're old. We don't want to be giving our money to the bank. And why would we want to give away a 1.5 million dollar house to charity after making all those payments? Doesn't make a bit of sense. We're charitable, but not THAT charitable! We're getting off topic anyway.
Because you can't take it with you.

By the way, have you ever looked into a reverse mortgage for your mother's house?
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Old 09-08-2019, 01:34 AM
 
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looked in to it .. these are considered high risk mortgages and the terms suck ... in good concious i could never eat up my equity with reverse interest and fees as fast as these reverse mortgages to purchase do. they have terrible terms
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Old 09-08-2019, 05:59 AM
 
Location: SW Florida
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I was under the impression that your house had to be paid off for a reverse mortgage? Maybe the rules are different in Florida.
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Old 09-08-2019, 07:13 AM
 
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Originally Posted by chiluvr1228 View Post
I was under the impression that your house had to be paid off for a reverse mortgage? Maybe the rules are different in Florida.
these are reverse mortgages to purchase not a regular reverse mortgage such as you get when you own the house already
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Old 09-08-2019, 11:02 AM
 
11,473 posts, read 11,489,725 times
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Originally Posted by jackmichigan View Post
Because you can't take it with you.

By the way, have you ever looked into a reverse mortgage for your mother's house?

No, Jack, that would require my mother to live in the house and she's currently a candidate for hospice and would need to be in a nursing home setting with round the clock care, which she couldn't afford even with a reverse mortgage.


But back to the reverse mortgage for a purchase. Can we use a reverse mortgage going out the gate to purchase a home we otherwise couldn't afford?
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