Buy Your Retirement Dream Home & Increase Your Cash Flow
If you dream about a new home in a warmer climate with modern design, amenities, and low maintenance, then you owe it to yourself to learn about a powerful alternative to using traditional financing or paying cash to purchase your next home and doing all of this while retaining a large portion of your life savings with a Home Equity Conversion Mortgage (HECM).
Ken and Karol Iberg had this dream and their dream became a reality. “At the time, we were living in a small townhome with a single car garage. Our loan officer explained how the HECM would allow us to move into a wonderful new home community that we are thrilled with. We supplied some of the equity from the sale of our townhome and used the HECM loan for the rest of the purchase price. The best part is we do not have a mortgage payment, didn’t touch our retirement funds, and now have additional funds to do all the traveling that we have always wanted to do,” said the Ibergs.
You are probably asking yourself “What the heck is a HECM?” This is a little-known strategy that middle income and affluent Boomers, like you, have been using since 2009 to purchase their dream homes. This is a federally insured loan program for buyers 62 years of age or better that requires a one-time down payment of 40-60%, and then the buyers are never required to make another mortgage payment.*
Why should you consider the HECM for Purchase option instead of paying cash or taking out a traditional mortgage? Perhaps you would like to have a bigger slice of the P.I.E. A buyer using all cash to buy a home has created a negative impact on their liquidity, while a buyer with a mortgage sees a negative impact on their monthly cash flow. Either option can shorten their financial horizon and create financial instability and sleepless nights for the retiree in their new home. The HECM for Purchase option gives the buyer a way to:
• [P]reserve assets
• [I]ncrease their cash flow
• [E]nsure liquidity
If more P.I.E. in your retirement sounds appealing, it might be worth your while to look at the HECM for Purchase option as you contemplate buying your dream retirement home.
*Buyers remain responsible for the ongoing payment of property taxes, homeowner’s insurance, and any required association dues. They must also maintain the property to minimum property standards.
Return to Finance.