Can a Reverse Mortgage Help Me Relocate Closer to Family?

A reverse mortgage can help you relocate closer to family by leveraging your current home’s equity to fund a new home purchase near your loved ones—without monthly mortgage payments—making the move financially smoother. The HECM for Purchase allows you to sell your existing home, combine the proceeds with a reverse mortgage, and buy a new primary residence closer to family, all while preserving your income or savings for other needs. It’s ideal if distance has kept you apart and you want to be near grandkids, siblings, or kids without having a monthly mortgage obligation.

How It Works

• • HECM for Purchase: You buy a new home using a reverse mortgage for part of the cost. You provide a down payment (typically 40-60%, based on age) from your home sale or savings, and the reverse mortgage covers the rest—no monthly payments required.
  • Eligibility: You’re 62+, the new home’s your primary residence, and you handle taxes, insurance, and upkeep.

Why It Helps Relocation

• • Closes the Gap: If the new home costs more than your current home’s equity,  the reverse mortgage fills the difference without draining your cash reserves.
  • No Payment Stress: Your retirement income (Social Security, pension) stays free for living expenses near family—think gas for visits or gifts for grandkids.

Examples

• • Downsizing Near Kids: Sell a $450,000 home, buy a $350,000 house near your son with $175,000 from the sale and $175,000 from the loan, you have  $100,000 to put in the bank.
  • Upsizing for Visits: Trade a $300,000 condo for a $500,000 home near grandkids—$280,000 from the sale, $220,000 from the reverse mortgage.

Quick Scenario

• • You’re 68, in a $330,000 home far from your daughter. You want a $380,000 place near her. Sell for $310,000, use $190,000 plus a $190,000 reverse mortgage—no payments, just taxes/insurance ($400/month). Your $1,800 income handles it, and you keep $120,000 from the sale.

Reverse mortgages can be a useful financial tool for eligible seniors looking to supplement income, pay for healthcare, or cover living expenses, but they also come with complexities that should be thoroughly understood before proceeding.

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