Purchase with No Mortgage Payment

One of the most underused—but most powerful—ways to use a Home Equity Conversion Mortgage (HECM) is to purchase a home.

With a HECM for Purchase, qualified homebuyers age 62 or older can buy their next home without being required to make monthly mortgage payments. Instead of paying all cash or taking on a traditional mortgage with monthly payments, the HECM lets you finance a portion of the purchase and never be required to make principal and interest payments for as long as you live in the home.

Key Benefits:

  • No Required Monthly Mortgage Payments
    You’re not obligated to make monthly principal or interest payments—freeing up cash flow during retirement. (You must continue to pay property taxes, homeowners insurance, and maintain the home.)
  • Stretch Your Buying Power
    Combine the HECM loan with a down payment to purchase a more suitable home—whether you’re downsizing, relocating closer to family, or moving into a single-level or low-maintenance home.
  • Age-Based Down Payment
    Your down payment amount is based on your age, the home’s value, and current interest rates. Older borrowers typically contribute a lower percentage of the home’s price.

Acceptable Down Payment Sources:

  • Proceeds from the sale of a current home
  • Savings or retirement accounts
  • Gifts from family (must be documented properly)
  • Other eligible liquid assets

Ideal for:

  • Retirees looking to right-size or relocate
  • Those wanting to preserve cash for retirement or investments
  • Homebuyers seeking to eliminate monthly mortgage obligations

Faq

Can I still leave the home to my heirs?

Yes. You retain full ownership and the title stays in your name—just like with any other mortgage.  Any equity in the property is yours as well.

Are there credit or income requirements?

Yes, there is a financial assessment to ensure you can afford property taxes, insurance, and basic upkeep, but qualification is often more flexible than traditional loans.

What types of homes are eligible?

Most single-family homes, 1 to 4 units, townhomes, and FHA-approved condos qualify. The home must be your primary residence.

Do I still own the home if I use a HECM to buy it?

Yes. You retain full ownership and the title stays in your name—just like with any other mortgage.

How much do I need for a down payment?

It depends on your age, interest rates, and the home’s value. Most buyers contribute between 40%–65% of the purchase price as a down payment. The rest is covered by the HECM.

Do I have to make payments at any point?

You are never required to make monthly mortgage payments as long as you live in the home but, you must keep up with property taxes, homeowners insurance, and home maintenance.

What happens if I move out or pass away?

At that point, the HECM loan becomes due. Your heirs can sell the home, refinance it, or pay off the balance. Any remaining equity goes to you or your estate.

Ready to See if It’s Right for You?

Book a No-Payment Home Loan Report
See how the Home Equity Conversion Mortgage can work for your next home purchase.

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