A reverse mortgage for home purchase is a federally insured loan that lets seniors buy a home without monthly mortgage payments. The FHA recently changed the rules so the reverse mortgage closes during the purchase itself, eliminating the need for a separate refinance later and cutting costs.
So a reverse mortgage for home purchase is a financial vehicle that allows for you to acquire property without having to make monthly mortgage payments. It's the same reverse mortgage that's insured by the federal government. In recent years, the FHA listened to a lot of realtors and borrower feedback, and what they did was they allowed for an improvement to the program to be closed in a purchase transaction. Whereas prior, a homeowner was buying a house outright or with conventional financing, their ultimate goal was to still have a reverse mortgage on that property. What they were doing was refinancing that traditional mortgage into a reverse mortgage after the sale was complete. And what that did was that it's a disadvantage to the senior who had to encumber closing costs, multiple transactions to get that property, ultimately get the reverse mortgage on it. So HUD came out with a ruling that allowed for, finally, for our industry to close the transaction
