Day 4 lesson 4
Using a regular Hecm to purchase a retirement home in advance.
You can use this product to create a new transaction today. You have some client(s) that want to retire in a different home when their existing home becomes to hard to keep up or no longer meet their needs.
They are able to buy that home today with a HECM (not a purchase) on their existing home and buy their retirement home in advance that they could use as their vacation home or even rent out.
Let's assume their existing home is valued at $450,000 and the home they want to purchase is $250,000. The transaction would look like this:
Using a reverse mortgage (HECM standard)
Appraised value of current home $465,000
Available cash form HECM loan $286,000
Price of retirement home $265,000
Cash used for purchase $265,000
Excess cash $21,000
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