HECM for Purchase: Buy Your Next Home With a Reverse Mortgage

A HECM for Purchase lets a homeowner age 62 or older use an FHA-insured reverse mortgage to buy a new main home. You pay part of the price in cash, and the HECM covers the rest. After you move in, you have no required monthly mortgage payment, but you still pay property taxes and homeowner's insurance and keep up the home.

How we work. Oakstone Capital Mortgage is a mortgage broker. We are not an FHA-approved lender, and we do not make or fund reverse mortgage loans. A lender that we work with makes and funds your loan and decides if you qualify. We help you apply. We compare wholesale lenders for you and show you every fee up front.

How it works

You put down cash for the difference between the HECM amount and the price of the home, plus closing costs. The HECM amount depends on the buyer's age, the interest rate, and the lesser of the appraised value, the sales price, or the FHA limit. In 2026 the FHA limit is $1,249,125 (HUD Mortgagee Letter 2025-22, checked October 2026).

Where the cash can come from

• Savings or cash on hand
• Money from selling other property or assets
• Some help from the seller, agent or builder, up to a set limit (not from the lender)
• Other sources the lender accepts

Cash from "sweat equity," trade equity, or rent credit does not count.

Rules to know

• You must move into the home within 60 days after closing.
• The home must be your only main home. If you have a HECM on your current home, it must be paid off before the new HECM can be insured.
• Eligible homes include 1 to 4 unit homes where you live in one unit, FHA-approved condos, and manufactured homes that meet FHA rules.
• The seller must be the owner of record. A home sold again within 90 days of the seller buying it usually is not eligible, with a few exceptions.
• The seller has to complete repairs that FHA requires. There is no repair set-aside.
• The lender may not charge discount points.
• The purchase has to pass the same counseling, financial check and appraisal steps as any HECM.

Why some buyers like it

• No required monthly mortgage payment on the new home.
• You can use more of your cash for moving, repairs and living costs.

Why it may not fit

• You still need enough cash for the difference and for closing costs.
• The loan balance grows over time and your equity goes down.
• You have to keep paying property taxes, insurance and upkeep.
• Your realtor and the seller have to be ready for FHA rules.

Steps (California)

• Talk with us about your budget and target homes.
• Meet with a HUD-approved counselor. We give you a list of agencies.
• Wait 7 days after counseling in California before a final application or fees.
• Make an offer. The contract must follow FHA rules.
• Appraisal, review, closing. You have a 3-business-day right to cancel.

Next step

Planning a move? Call 949-800-8519 or contact us. We will walk you and your agent through the steps.

Frequently asked questions

• Who is a HECM for Purchase for? Homeowners age 62+ who want to buy a new main home and have cash to cover the gap between the loan and the price.
• How much cash do I need? It depends on the price, your age, the interest rate and the closing costs. We give you a written number before you decide.
• Can I use it for a second home or rental? No. The home must be your main home.
• I already have a HECM on my current home. Can I still do this? Yes, but the old HECM must be paid off before the new loan can be insured. The sale of your current home can pay it off.
• Can I buy a condo? Maybe. The condo project must be FHA-approved.

License and disclosures

Loans made or arranged pursuant to a California Financing Law license.

Oakstone Capital Mortgage, Irvine, California.

Oakstone Capital Mortgage NMLS #2585868

California Financing Law license number: #60DBO-194582

Steven Arroyo NMLS #1576672

Check any license at nmlsconsumeraccess.org.

Oakstone Capital Mortgage is a mortgage broker and is not an FHA-approved lender.

This website is not from or approved by HUD, FHA, or any government agency. Oakstone is not affiliated with the U.S. government.

Reverse mortgage borrowers must pay property taxes and homeowner's insurance, keep the home in good repair, and live in the home as their main home. Interest and fees are added to the loan balance. You are not required to complete a reverse mortgage just because you have received disclosures.

Equal Housing Opportunity