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Frequently asked questions & answers about HECM for Purchase

What sources are allowed for the cash required to close?

What sources cannot be used for the cash to close?

What property types are eligible?

What requirements must the new home meet?

What are the borrower responsibilities?

  • The sale of the prior home

  • The sale of the borrower's other assets

  • The borrower's personal savings

  • Seller financing and concessions

  • Funds withdrawn from credit cards

  • A bridge loan of any kind

  • Subordinate financing

  • Single family

  • HUD-approved condos

  • Planned unit developments (PUDs)

  • Two to four unit properties (one occupied by the borrower)

  • Must be the borrower's primary residence

  • Must be occupied by the borrower within 60 days from the closing date

  • Construction must be complete, the property habitable, and a certificate of occupancy issued prior to the loan application

  • One of the borrowers continuing to live in the home

  • Keeping current on tax & insurance payments on the property

  • Maintain the property according to FHA standards

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