If I am Downsizing, Would a Reverse Mortgage Help Me?

Yes, a reverse mortgage can absolutely help if you’re downsizing—especially if you use a Home Equity Conversion Mortgage for Purchase (HECM for Purchase).

Here’s how it works:

Instead of using all cash from the sale of your current home to buy your next one, a HECM for Purchase allows you to combine a down payment (usually from your home sale proceeds or savings) with a reverse mortgage loan to buy a new home—without taking on monthly mortgage payments. This can free up a significant portion of your equity to use however you like: covering living expenses, boosting retirement savings, or just having peace of mind with extra cash on hand.

Some Key Benefits:

• No monthly mortgage payments (you still pay property taxes, homeowners insurance, and maintenance).
  
• Right-size into a home that better fits your lifestyle—maybe single-level living, less maintenance, or closer to family.
  
• Preserve liquidity by not tying up all your home sale proceeds in the next home.

So if you’re looking to simplify your living situation while improving your financial flexibility in retirement, a reverse mortgage for purchase can be a smart, strategic move.

Learn more about eligibility requirements for a reverse mortgage, situations where a reverse mortgage is best used, and common myths around reverse mortgage that we debunk with facts